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Teachers Union Sues Education Secretary over Public Service Loan Forgiveness
The suit says 90,000 borrowers face delayed relief as the department stalls buyback applications and rescinds payments that counted toward forgiveness.
On Friday, the American Federation of Teachers sued Education Secretary Linda McMahon, alleging the department unlawfully blocked Public Service Loan Forgiveness for thousands of qualified borrowers.
The Public Service Loan Forgiveness program allows government and nonprofit employees to cancel federal student loans after 120 payments, but a critical "buyback" provision has faced severe administrative backlogs.
Seeking class-action status, the lawsuit alleges the Education Department has failed to process 90,000 buyback applications, trapping borrowers in debt despite qualifying employment.
An Education Department spokesperson defended the adjustments, characterizing them as corrections to "coding errors" from the previous administration to ensure accurate credit for qualifying payments.
Clearing the current backlog would take more than 18 months at the department's fastest processing rate, leaving borrowers like speech-language pathologist Elizabeth Schoepflin facing extended repayment timelines.