On March 7, 2025, President Donald Trump announced plans to sign an executive order that could significantly alter the Public Service Loan Forgiveness (PSLF) program—a federal initiative designed to provide debt relief to public servants after a decade of qualifying payments.

Understanding the Public Service Loan Forgiveness Program

The PSLF program was established in 2007 with bipartisan support, aiming to encourage individuals to pursue careers in public service and nonprofit sectors. Eligible professions include teachers, nurses, firefighters, military personnel, and various nonprofit employees.

To qualify for loan forgiveness, borrowers must make 120 qualifying monthly payments while employed full-time by a qualifying employer and under an eligible repayment plan.

Despite previous issues with low approval rates due to complex requirements and poor administration, PSLF saw a revival during the Biden administration, resulting in substantial forgiveness for over a million borrowers.

Details of Trump’s Proposed Changes

During his announcement, Trump indicated that the forthcoming executive order would impose restrictions on PSLF eligibility linked to the perceived legality or conduct of organizations employing PSLF participants. “If an organization is ‘not good,’ borrowers ‘wouldn’t get forgiveness,’” Trump stated.

However, the lack of clarity regarding definitions of “illegal” and “improper activities” raises concerns about potential overreach and ambiguity in execution.

The Legal Implications of the Executive Order

The PSLF statute itself clearly delineates what constitutes public service employment and does not grant the president authority to impose additional restrictions based on an organization’s activities or ideological stance. According to the law, a broad definition of a public service job includes roles in emergency management, education, healthcare, legal services for low-income communities, and various public health fields.

Experts are wary that broad changes could violate the established framework for PSLF and contradict prior statements from Education Secretary Linda McMahon, who emphasized the importance of adhering to federal student loan forgiveness laws.

Broader Republican Efforts to Reform PSLF

This executive order may just be the beginning of an effort by Republican lawmakers to reduce student loan forgiveness options. Congressional leaders are reportedly considering additional legislative measures that could impact PSLF eligibility while trying to offset significant costs associated with tax cuts.

Among potential reforms is a proposal to alter the tax status of nonprofit entities, including healthcare providers, which could have a trickle-down effect on PSLF eligibility for millions in the healthcare sector who are dependent on this forgiveness program.

Current Challenges for Borrowers

Additionally, the Department of Education has paused income-driven repayment applications, further complicating the pathway for borrowers seeking PSLF. As this vital component is often intertwined with PSLF eligibility, many may find their pursuit for forgiveness blocked amid these changes.