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A few days ago, the President of the United States, Donald Trump, signed an executive order that seeks to limit who is eligible for Public Service Loan Forgiveness (PSLF).
This order directs the Secretary of Education to develop a proposal to exclude from PSLF eligibility those borrowers employed by organizations that perform significant illegal functions.
The program eliminates a borrower's federal student loan debt after 10 years of payments as long as they work in a public service role, such as educators, firefighters, police officers, healthcare professionals, government employees, or employees of nonprofit organizations.
Although there are many questions, PSLF borrowers can get ahead of the game by understanding the new policy, identifying who will benefit, and monitoring their progress through the process.
Here's everything you need to know right now.
What will the executive order signed by Trump do?
Trump's executive order directs Linda McMahon, Secretary of Education, to propose restrictions on PSLF, excluding certain nonprofit organizations. The Department of Education assures that the program will continue unchanged for now and will be istered efficiently.
Be careful, its validity continues to be questioned, pointing out that the PSLF was established by Congress in 2007 under Bush, and foresees legal complications with no clear results, there are still many doubts.
"The PSLF program, created by Congress nearly 20 years ago, does not give the istration the power to determine which nonprofit organizations should be eligible," said Jessica Thompson, executive vice president of the Institute for Access and Educational Success.
What will happen now, what should I know?
Organizations such as the AFT, led by Randi Weingarten, plan to file a lawsuit against the executive order limiting PSLF, arguing that it violates the law.
Daniel Collier, an education expert, questions its legal validity and warns of its negative impact on free speech and nonprofit organizations.
"We're going to see a lot of side effects on people's mental health, behavior and productivity," Collier said in a statement.
"Please make sure you protect yourself and get the help you need to get through these times."
He also fears that, as in Trump's first term, the Department of Education will mismanage the program, as evidenced by the massive rejection of applications. In contrast, under Biden, the program forgave $78.5 billion to more than one million public employees.