With
President-Elect
Trump
returning
to
the
White
House
in
January,
borrowers
repaying
their
loans
are
wondering
what
will
happen
next.
His
first
Secretary
of
Education
Betsy
DeVos
was
not
known
for
being
friendly
or
receptive
to
borrowers,
and
getting
loan
forgiveness
was
like
pulling
teeth.
Trump
recently
announced
that
he
would
nominate
Linda
McMahon
to
be
incoming
secretary
of
education.
She
was
the
head
of
the
Small
Business
Administration
during
Trump’s
first
term
and
was
a
member
of
the
Connecticut
State
Board
of
Education
in
2009.
She
also
survived
the
Stone
Cold
Stunner.
But
no
one
knows
her
position
on
student
loans.
While
no
plans
have
been
announced
by
Trump
or
McMahon,
a
few
existing
programs
are
likely
to
undergo
changes.
The
SAVE
Repayment
Program
Is
Likely
To
Be
Terminated
President
Biden
introduced
a
new
income-driven
repayment
plan
called
Saving
on
a
Valuable
Education
or
SAVE.
This
was
in
response
to
the
Supreme
Court’s
overturning
of
his
executive
order
which
would
forgive
up
to
$20,000
of
a
borrower’s
federal
student
loan.
The
SAVE
plan
would
replace
the
Revised
Pay
As
You
Earn
(REPAYE)
plan.
It
would
cap
the
monthly
payment
based
on
income
and
family
size.
Also,
if
the
monthly
payment
was
not
enough
to
cover
the
interest
accrued
for
the
month,
the
accrued
amount
would
be
forgiven.
Borrowers
with
smaller
balances
(usually
by
attending
community
colleges)
can
have
their
loans
forgiven
in
as
little
as
10
years.
But
Republican-led
states
filed
lawsuits
in
response
and
last
August,
the
Eighth
Circuit
Court
of
Appeals
struck
down
the
SAVE
program.
People
currently
in
the
program
have
been
placed
in
forbearance
status
although
the
time
spent
in
this
status
does
not
count
toward
loan
forgiveness.
The
Trump-led
Department
of
Justice
is
likely
to
let
this
ruling
stand
and
take
no
further
action.
If
SAVE
is
not
saved,
then
borrowers
will
be
placed
in
a
standard
repayment
program
or
on
the
REPAYE
income-driven
repayment
plan.
Borrower
Defense
To
Repayment
Rules
May
Change
Yet
Again
The
Borrower
Defense
to
Repayment
(BDR)
program
allows
for
loan
forgiveness
if
applicants
can
show
that
they
attended
their
schools
based
on
false
or
misleading
information.
Over
the
years,
BDR
rules
and
regulations
have
changed
usually
when
a
new
administration
takes
office
and
legal
challenges
added
further
complexity.
But
to
summarize,
any
BDR
application
submitted
before
July
1,
2020,
was
to
use
the
regulations
promulgated
under
the
Obama
administration.
Any
applications
submitted
after
that
date
would
be
subject
to
different
regulations
established
under
the
Trump
administration.
It
is
believed
that
the
Trump
regulations
made
it
more
difficult
to
obtain
loan
forgiveness
through
BDR.
In
2022,
the
Biden
administration’s
Department
of
Education
proposed
new
BDR
relief
regulations
which
were
believed
to
make
it
easier
to
obtain
loan
forgiveness.
But
this
has
also
been
subject
to
a
court
challenge,
and
an
injunction
is
in
effect
until
the
case
is
resolved.
But
the
department
states
that
borrowers
can
still
apply
for
BDR
relief
while
the
injunction
is
in
effect.
If
the
BDR
regulations
under
Biden
are
struck
down,
then
the
government
under
Trump
may
decide
not
to
appeal
the
decision.
For
now,
whether
the
Biden
regulations
or
the
older
Trump
regulations
will
apply
to
current
BDR
applications
is
unclear.
It
is
also
possible
that
the
Department
of
Education
under
McMahon
or
another
Trump
appointee
could
propose
new
regulations,
although
they
are
likely
to
make
BDR
eligibility
more
difficult.
Borrowers
who
think
they
could
be
eligible
for
BDR
loan
forgiveness
should
apply
as
soon
as
possible
even
though
it
is
possible
that
their
applications
could
be
reviewed
under
a
more
difficult
standard.
They
have
nothing
to
lose
by
applying
as
the
worst
that
can
happen
is
that
the
application
will
be
denied.
Also,
those
who
apply
earlier
may
have
a
better
chance
of
getting
a
favorable
decision
if
they
apply
before
the
floodgates
are
opened.
For
example,
in
2022,
the
federal
government
accepted
a
settlement
where
BDR
applicants
who
attended
certain
schools
would
be
eligible
for
full
loan
forgiveness
under
a
very
lenient
review
standard
if
they
applied
before
the
settlement
date.
But
applications
received
after
the
settlement
date
will
be
subject
to
a
different
and
more
difficult
standard
of
review.
Forgiveness
Under
The
PSLF
Programs
Might
Be
More
Difficult
Borrowers
who
are
enrolled
in
the
Public
Service
Loan
Forgiveness
(PSLF)
program
should
make
sure
that
their
eligibility
status
is
not
in
jeopardy
and
take
advantage
of
any
regulations
set
by
the
current
administration.
In
2018,
it
was
reported
that
99%
of
PSLF
loan
forgiveness
applications
were
denied.
Also,
in
2017,
Trump
proposed
eliminating
PSLF
in
his
budget
proposal.
During
the
Biden
administration,
the
Department
of
Education
issued
a
number
of
regulations
that
made
more
borrowers
eligible
for
PSLF.
Even
though
Republicans
will
control
the
presidency
and
both
houses
of
Congress,
it
is
unlikely
that
PSLF
will
be
repealed.
Even
if
it
is
repealed,
it
is
unlikely
to
be
applied
retroactively.
However,
it
may
be
adjusted
so
that
only
a
limited
amount
of
loans
will
be
forgiven.
For
example,
President
Obama
suggested
a
capping
the
forgiveness
amount
at
$57,500
in
2014.
Borrowers
who
anticipate
getting
loan
forgiveness
between
2025
and
2029
should
keep
an
eye
on
their
student
loan
account
balance
on
a
regular
basis.
They
should
also
make
sure
that
all
of
their
employer
certifications
are
submitted
on
time.
Lastly,
they
should
obtain
all
news
alerts
involving
PSLF.
You
Will
Still
Have
To
Pay
Your
Loans
If
The
Department
Of
Education
Is
Abolished
Even
though
Trump
has
said
that
he
would
abolish
the
Department
of
Education,
it
is
a
long
shot.
But
even
if
the
department
folds,
it
does
not
mean
a
wholesale
cancellation
of
federal
student
loans.
Student
loan
repayment
servicers
will
probably
continue
to
collect
from
borrowers,
but
they
will
answer
to
another
department,
most
likely
the
Treasury
Department.
Until
Trump
or
McMahon
releases
more
details,
it
is
safe
to
assume
that
borrowers
will
have
to
pay
more
than
what
they
were
paying
before
for
at
least
the
next
four
years.
Also,
those
who
are
delinquent
on
their
loans
or
are
in
default
will
not
be
given
the
kid
gloves
treatment
anymore.
People
with
tight
budgets
should
do
some
financial
planning
as
soon
as
possible.
And
to
those
who
could
be
eligible
for
student
loan
forgiveness
in
the
next
four
years,
make
sure
to
dot
every
“i”
and
cross
every
“t”
so
the
government
will
not
have
an
excuse
to
deny
your
forgiveness
application.
Steven
Chung
is
a
tax
attorney
in
Los
Angeles,
California.
He
helps
people
with
basic
tax
planning
and
resolve
tax
disputes.
He
is
also
sympathetic
to
people
with
large
student
loans.
He
can
be
reached
via
email
at
[email protected].
Or
you
can
connect
with
him
on
Twitter
(@stevenchung)
and
connect
with
him
on LinkedIn.