‎Trump Administration's New Rule Limits Public Service Loan Forgiveness Eligibility

‎Student loan borrowers seeking debt relief through the Public Service Loan Forgiveness (PSLF) program could face new obstacles due to a rule issued under the Trump administration. The change, which modifies eligibility standards for participating organizations, affects many workers pursuing forgiveness after a decade of public service.

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‎A new Trump administration rule restricts Public Service Loan Forgiveness eligibility, impacting nonprofits and public service workers.

‎Tom Brenner/The Washington Post

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‎The PSLF program, launched in 2007 under President George W. Bush, allows qualifying borrowers employed in public service or nonprofit sectors to have their remaining federal student loan balances forgiven after ten years of eligible payments. The initiative was created to attract professionals to critical fields such as education, healthcare, and social work.

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‎Under an executive order signed in March, certain organizations are now excluded from the program. The order prohibits PSLF eligibility for employers that, according to the administration, engage in or support “illegal immigration, child trafficking, pervasive damage to public property, or disruption of the public order.”

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‎U.S. Under Secretary of Education Nicholas Kent stated that the program’s purpose is to reward individuals serving their communities lawfully, not to fund entities involved in activities that violate federal or state laws. Kent emphasized that the administration intends to ensure taxpayer dollars do not support such organizations.

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‎Critics argue that the new rule introduces political bias into a program designed to promote public service. Representative Robert C. Scott of Virginia, a member of the House Education Committee, warned that the measure could harm organizations assisting marginalized populations and make loan forgiveness more difficult to obtain.

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‎Progressive advocacy groups Democracy Forward and Protect Borrowers jointly condemned the policy, calling it an “unconstitutional power grab” that undermines Congress’s authority. The organizations said they plan to challenge the Trump-Vance administration in court over what they described as an overreach of executive power.

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‎According to the Department of Education, prohibited “illegal activities” under the new rule include aiding or abetting violations of immigration law, supporting terrorism, performing prohibited medical procedures on minors, and engaging in child trafficking or unlawful discrimination.

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‎Borrowers already earning credit toward forgiveness will not lose progress if their employer becomes ineligible under the revised rule. However, they will not be able to accumulate additional qualifying payments while working for an excluded organization. The policy is scheduled to take effect on July 1.