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As I blogged about a couple weeks ago, you can check the amount of IDR time you have been credited for on studentaid.gov now.  If for any reason it is not there, a private company has released the VIN Foundation Download My IDR Progress browser extension for Chrome.  It allows a borrower to grab a copy of their IDR payment history showing the qualifying vs. ineligible payments.

Yesterday the new Secretary of Education, Linda McMahon, was confirmed so perhaps we will learn of some concrete plans for the Department of Education shortly.

I read today in the Pomp Letter that the average credit card balance is $21,000.  And the average interest rate is 28.6%.  Just wow.  In 30 months, the debt would double.  In our bankruptcy practice here in Tampa, Florida, we are regularly seeing people with 100k of credit card debt.

Many people are making only minimum payments of their bills – 10.75% according to a new report from the Philadelphia Federal Reserve (reviewing data for the third quarter of 2024.

I don’t know how you get out of that – unless you file bankruptcy.  Or have some kind of windfall such as a much better paying new job, inheritance or something.  Even with a much better paying new job, you would have to dedicate funds quickly to pay down that debt.  Back during the foreclosure crisis we ran into a lot of people who thought that they could easily catch up once they started working again.  Didn’t happen.  Even a $20k increase in pay is not that much paycheck to paycheck.  With interest so high, the balances got even larger or remained the same.

So the big news in the world of student loans is that the online system has once again been shut down for consolidations and IDR applications – as of Friday, Feb 21.  This is likely due to the 8th Circuit expanding its stay to stop all forgiveness under PAYE and ICR.  For now, someone’s best bet for forgiveness is to get onto IBR – Income Based Repayment.  IBR was Congressionally passed in 2009 and does not appear to be going anywhere.  It’s a 25 year program that allows for full forgiveness of any remaining balance once 25 years of IBR credits is obtained.

The 8th Circuit also halted the IDR Recount. While we don’t believe that any loans previously forgiven will be reinstated, we really don’t know what will happen to those pending loans benefitting from the IDR Recount – but still have months or years to go.  The best we can say is to keep copies and screenshots of anything to do with the IDR Recount.  You may need this one day.

So why is the consolidation button greyed out?  Both FFEL loans and Direct Loans are eligible for IBR.  So a consolidation isn’t necessary for IBR.  If the government is discouraging Double Consolidation for Parent Plus loans, PAYE, ICR and the IDR Recount, there really isn’t a reason to consolidate older federal student loans under the FFEL system to the newer Direct loans.  Also the government has to pay the private originators of a FFEL loan upon its consolidation to a Direct loan.  It doesn’t want to do that.

Well, we are now midway into the second week of President Trump’s administration.  What can we expect and how can you deal with your federal student loan payments?

Importantly, there were no first day Executive Orders, and none so far other than the appointment of a new Secretary of Education.  I view that as good news.  That tells us that the new administration is not focused on student loans – at least not to the extent that it could have been.  We’ve seen orders withdrawing our country from WHO, and the Paris climate whatever, but nothing about PSLF, the IDR plans, or even the elimination of the Department of Education.

However, it’s coming.  There will be a week where student loans will be all the talk.  Do you wait until then to make decisions?  I don’t think that’s a good idea now.