Student Loan Forgiveness: What Changed in 2025?

As 2025 wrapped up, the student loan forgiveness landscape saw some shifts. The Department of Education restarted several programs that had been on hold. Before leaving office, former President Joe Biden's administration had already greenlit billions in loan forgiveness. This relief came through various programs, like income-based repayment plans, Public Service Loan Forgiveness (PSLF), and cases of borrower defense or total disability. One big hurdle in 2025 was the pause on income-driven repayment plans. These plans usually forgive the remaining loan balance after 20 or 25 years of payments. Public service workers also faced delays in getting forgiveness through PSLF after 10 years of payments.The Department of Education hit pause on processing forgiveness for income-driven repayment plans earlier in the year. But in October, they announced they would start approving forgiveness again under certain plans. Plus, any forgiveness granted before the end of 2025 won't be subject to federal taxes, even if processed in 2026. Between November 1 and 30, 170 loans were discharged under the Income-Based Repayment Plan. However, thousands more were approved between October and early December. The backlog is expected to clear by March or April 2026. On the PSLF front, the Department of Education offered a "buy-back" opportunity. This allows public service workers to count months spent in deferment or forbearance toward their 10-year requirement. Applications for this buy-back surged, and the department has been processing them. In November alone, 280 loans were discharged through PSLF, but 80, 210 applications were still pending.