Donald Trump's administration has agreed to cancel student debt through programs that were previously restricted. The decision follows an agreement reached on Friday, 17 October 2025, between the U.S. Department of Education and the American Federation of Teachers, a union representing educators across the country. The deal marks an important policy reversal - allowing thousands of borrowers enrolled in income-driven repayment and public service loan forgiveness plans to once again qualify for debt relief.
CNBC reported that under the updated deal, Trump's administration will reopen the processing of the student loan forgiveness for qualified individuals enrolled in the Income-Contingent Repayment and Pay As You Earn plans, as long as the programs remain active. This will give borrowers in certain repayment plans the chance to apply for relief while also protecting them from potential tax liabilities that would have taken effect in early 2026.
-copy-dd1f2bf0.jpeg?w=600)
