Overview

• Negotiators completed a rulemaking panel July 2 and the department is drafting a formal proposed overhaul of the Public Service Loan Forgiveness program.
• Draft rules define illegal activities to include aiding immigration law violations, supporting foreign terrorist organizations, breaching the Civil Rights Act and providing gender-affirming care for minors.
• The education secretary would gain subjective authority to strip entire employers of forgiveness eligibility without requiring convictions or settlements.
• Over one million borrowers risk losing credit toward loan cancellation if their employers are deemed ineligible, potentially forcing them to change jobs.
• The proposed rule will enter a public comment period before a targeted July 2026 effective date, highlighting a broader partisan fight over student debt relief authority.