"Loan forgiveness is not happening"

Last Thursday at the American Enterprise Institute, the Education Department’s Undersecretary, Nicholas Kent, did something officials rarely do. He apologized.

“I’m sorry. I’m sorry that you were frustrated, and I’m sorry that you are confused about everything that has happened over the course of the last five or six years with regard to the federal student loan portfolio.”

Then he said the part that matters: “What we have been trying to do is explain to borrowers that loan forgiveness is not happening.”

That’s the administration’s position, stated plainly. Repayment is the plan.

A line that strong needs context. What Kent meant — if I were to speak for him — is no new broad cancellation. The Biden-style “wipe your balance away” effort is over. But the forgiveness already on the books hasn’t stopped. Borrowers are still hitting their 20- and 25-year marks under IBR, PAYE, and ICR and getting discharged. PSLF is still on the books — 120 qualifying payments, and the balance goes away. RAP launches in July with its own 30-year forgiveness path. The one-time IDR account adjustment is still working through.

If you’ve been making payments toward forgiveness, keep making them. If you work in public service, keep certifying.

Kent pointed borrowers toward RAP and noted the government has tools like wage garnishment and Treasury offset. He said the department wants to “make sure that we don’t start with those tools.” Voluntary first. Forced collection if voluntary doesn’t work.

Behind Kent’s message is a structural change already underway. The Education Department announced in March that it’s moving the $1.7 trillion student loan portfolio to the Treasury Department, starting with the millions of borrowers in default.

Treasury is good at collecting federal debt. It runs the Treasury Offset Program and has administrative wage garnishment authority. What it hasn’t done much of is account rehabilitation — working out a path back to good standing instead of just seizing the money.

The two agencies tried something like this in 2015. POLITICO reported that one year in, Treasury had rehabilitated 8 of 5,729 borrowers. Treasury’s Bureau of the Fiscal Service — the office now slated to take over — has 39% fewer staff than it did in 2024.

The new regime also has a calendar. July 1 is the date that matters most for existing borrowers.

That’s when RAP launches and PAYE and ICR begin their wind-down toward a 2028 sunset. If you’re on SAVE right now, you’ll need to pick a new plan. (You have up to 90 days starting July 1, 2026.) IBR is the only existing income-driven plan that survives long-term.

For parents with Parent PLUS loans, July 1 is sharper. After that date, new Parent PLUS borrowers lose access to income-driven repayment. If you’ve got Parent PLUS loans and you’ve been thinking about consolidating to access ICR, the window closes in roughly nine weeks.

These changes were written into the OBBBA last year. They’ve been on the calendar for months. They’re now close enough to act on.

If you want help thinking through which plan to pick — or what to do before July 1 — you can book a call here: https://www.tateesq.com/book-a-call

I spent the weekend planting flowers and a few trees out front and on the upstairs patio, then installing a drip irrigation system to keep it all alive while I’m in Puerto Rico. Had to learn how to get rid of midges and how to keep pots with trees in them from blowing over in the 20-mph winds we get on the harbor.

Basically, I’m a handyman gardener. And that feels good. I spend so many hours indoors, behind a screen — stepping out into the sun feels great. I need more of that in my life. I’ll be back in PR in a couple of weeks. When I land, the first thing I’m doing is heading to the beach with a six-pack of Coronas and a Padrón 1926 No. 9.