ST. LOUIS, Mo. (First Alert 4) – As changes to federal student loan repayment plans continue, The Scholarship Foundation of St. Louis is urging students seeking financial aid to look for help in as many places as possible.
“There’s a lot of uncertainty, and things are changing very quickly,” Teresa Steinkamp, Director of Advising at The Scholarship Foundation of St. Louis, says. “We are seeing students, families and borrowers with questions and concerns.”
“We’re doing our best to keep up to provide accurate and objective information,” Steinkamp says.
The uptick in calls for help comes amid the Trump Administration’s efforts to consolidate or potentially shutter the Department of Education. Tuesday, the department announced layoffs for more than 1,300 employees.
The Trump Administration’s cost-cutting measures are also looking at a student loan program overhaul. As a result, the department has suspended its most affordable federal student loan repayment plans.
The change comes three weeks after a U.S. appeals court issued an injunction, expanding a previous injunction, to block former President Joe Biden’s income-driven loan repayment program called Saving on a Valuable Education (SAVE) for three months, forcing borrowers enrolled to switch to another program, likely leading to higher monthly payments.
The IDR plans offered lower monthly payments and loan forgiveness in some cases.
The department also announced it will not accept or process applications for any of the programs during the pause.
This also comes as the Trump Administration targets the Public Service Loan Forgiveness program (PSLF), which offers borrowers a path to forgiveness if they work in the public or nonprofit sectors. Borrowers can qualify for total forgiveness after 120 qualifying monthly payments.
The Education Data Initiative reports that over three million educators, healthcare workers, military personnel and first responders are progressing toward loan forgiveness through PSLF.
Trump recently signed an executive order that looks to cut off student loan forgiveness on a broad scale.
“As frustrating as this all is right now for students and families and borrowers, we just don’t know what’s going to happen,” Steinkamp said.
The Scholarship Foundation of St. Louis offered some tips to borrowers amid the changes:
“It’s a good idea to document these things regardless of the [Department of Education potentially shutting down],” Steinkamp.
“There’s a lot of speculation right now on this – what we do know is there are many functions of the Department of Education that are critical for students to be able to pay for college, including FAFSA, and those functions would potentially be moved to other departments,” Steinkamp said.
“Our biggest concern is that those functions remain intact… but we don’t know where these functions could move to,” Steinkamp said.
The Scholarship Foundation of St. Louis offers scholarships with the help of community partners. More information can be found here.
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