Alexander Watts, a nurse at Ohio State University’s medical center, was months from completing the federal Public Service Loan Forgiveness (PSLF) program when a required buyback application was left unprocessed for nearly two years, according to a lawsuit filed by the American Federation of Teachers. The suit names Education Secretary Linda McMahon and claims tens of thousands of public servants face similar delays. The PSLF program cancels remaining federal student loan debt after 120 payments in an income-driven repayment plan and at least 10 years of eligible public service. While many have succeeded, others have been caught in bureaucratic delays amid shifting policies under the Biden and Trump administrations. The Biden administration reviewed years of mismanagement and offered borrowers the chance to buy back months of eligibility, requiring an application. However, the lawsuit alleges the Education Department is reviewing these applications slowly, with some borrowers unable to track their progress or seeing payment counts drop without explanation. A department spokeswoman said the review is a manual process being transitioned to loan servicers, calling the lawsuit a distraction.
Without debt cancellation, borrowers struggle to redirect payments toward home down payments, college savings, or other financial goals. The ongoing delays highlight long-standing issues within the Education Department, affecting an estimated 90,000 public employees.
Source: New York Times Business · Summarized by HeadlinesBriefing