What student loan borrowers can and can’t do
The U.S. Capitol Dome is seen in reflection in Washington, DC, on October 14, 2025.
Andrew Harnik | Getty Images News | Getty Images
As the government shutdown drags on, it’s not easy for borrowers to gauge what’s happening with their student loan debt.
The U.S. Department of Education, for example, is sending forgiveness notices to some borrowers, but a lawsuit regarding repayment plans and debt cancellation is pending during the deadlock in Washington.
One thing that isn’t on pause: student loan payments. Borrowers still need to pay their monthly bills during government shutdown, according to Department of Education memory From the end of September.
With no end to the impasse in sight, there are other things federal student loan holders need to know about what they can and can’t do regarding their debt.
“Don’t panic,” said President Betsy Mayotte. Institute of Student Loan Consultantsis a non-profit organization that helps borrowers repay their debts. “The vast majority of actions regarding federal student loans remain available.”
Borrowers still can ‘just about anything’
Fortunately for federal student loan borrowers, most loan tasks are handled by companies contracted by the government. These student loan service providersIt continues its operations, including Nelnet and CRI.
“We’re really not impacted right now,” said Scott Buchanan, executive director of the Student Loan Servicing Association, a trade group for federal student loan servicers.
For now, borrowers can do “pretty much anything,” Buchanan said. He said they can apply for new repayment plans, request updated billing statements and contact customer service.
If you do not know which company manages your student loans on behalf of the Department of Education, you can find out here: studentaid.gov.
Borrowers can also apply for loan forgiveness under programs such as the Public Service Loan Forgiveness program and the Public Service Loan Forgiveness program. Total and Permanent Disability Discharge.
But getting loan cancellation approved is another story.
Where borrowers will feel the effects of the shutdown
Although federal student loan borrowers were able to apply for debt cancellation programs during the government shutdown, they won’t see relief until institutions reopen, said Nancy Nierman, deputy director of the Education Debt Consumer Assistance Program in New York.
“The actual demobilization will be delayed as it must be approved by the Ministry of Education, which has furloughed or laid off most of its staff,” Nierman said.
Delayed forgiveness can result in a tax bill for borrowers. American Rescue Plan Act of 2021 student loan forgiveness Federally tax-exempt until the end of 2025. But President Donald Trump’s “big beautiful” tax and spending package did not expand or make permanent this broader provision, meaning the loan write-off could lead to a bill from the IRS in January.
Even before the shutdown, some student loan borrowers were already experiencing delays in applying for loan forgiveness under the Trump administration.
The delays led the American Federation of Teachers to file a legal challenge against Trump officials in March; In this case, the Federation accused the Ministry of Education of denying borrowers the right to benefit from debt forgiveness opportunities mandated in the loan terms.
This case is pending during the government shutdown.
