Misty Knapp just wants the student-loan forgiveness she was promised.
Knapp, 59, has been working in public service as a nurse since 2012 and has been enrolled in the Public Service Loan Forgiveness program since 2017, which forgives student debt for government and nonprofit workers after 10 years of qualifying payments.
She said she didn’t know PSLF existed when she entered public service, but once she saw it was possible to get her six-figure balance forgiven, she was banking on the relief. She now has a projected six payments left to make.
However, she’s been in payment limbo since the summer of 2024, and she’s worried that the relief she’s counting on will keep getting pushed back.
“I’m really just trapped,” Knapp told Business Insider. She’s enrolled in the SAVE income-driven repayment plan, which has been paused due to ongoing litigation. “I can’t move forward with my life plan at all while I’m stuck in this loan forgiveness purgatory.”
It’s a purgatory millions of other student-loan borrowers are familiar with. Since President Donald Trump took office, he has proposed a slew of changes to the student-loan industry, including eliminating existing repayment plans like SAVE, limiting eligibility for PSLF, and placing new borrowing caps on advanced degree programs. The changes have left borrowers wondering when — and if — they’ll face higher monthly payments or receive debt relief.
Trump’s administration is set to begin implementing many of these changes, which the president signed into law in his “big beautiful” spending legislation, in July 2026. Undersecretary of Education Nicholas Kent said in a statement that the repayment changes “will benefit borrowers who will no longer be pushed into insurmountable debt to finance degrees that do not pay off.”
Implementing these changes is a significant undertaking for the Department of Education and student-loan servicers, especially as the administration is working to dismantle the department. Knapp said she’s “a nervous wreck.”
“I should have been done long ago, but because of all this red tape and being tied up and not being able to make payments, I haven’t been able to complete it,” Knapp said. “It’s very frustrating.”
A year of student-loan upheaval
It’s challenging to keep track of the numerous changes to the student-loan industry that Trump has proposed or implemented in just one year. That list includes: narrowing eligibility for PSLF; eliminating the SAVE plan; eliminating the Grad PLUS program; resuming collections on defaulted student loans; resuming forgiveness for income-based repayment; new borrowing caps for graduate and professional degrees; introducing a new income-driven repayment plan; and more. In addition, Trump has said he wants to eliminate the Education Department altogether.
While most of the changes have not yet been implemented, Business Insider spoke to dozens of student-loan borrowers throughout the year who said they’re feeling anxious — especially because they cannot financially prepare for repayment or relief changes without clear communication and timelines from the Department of Education.
Take the SAVE plan: former President Joe Biden created the plan in 2023, and it was intended to give affordable monthly payments to borrowers with a shorter timeline to loan forgiveness. A group of GOP-led states sued to block the plan, and 7 million enrolled borrowers, like Knapp, have been on forbearance since the summer of 2024. Trump restarted interest on SAVE borrowers’ accounts in August, and his administration recently announced an agreement to officially end the plan.
Mike Rendino, a 51-year-old SAVE borrower, told Business Insider in March that SAVE allowed him to pay $160 a month. Without SAVE, he said his projected monthly payment would be just under $1,000.
“It’s going to be very scary to figure this out,” Rendino said.
Uncertainty also loomed for public servants. After Trump signed his executive order in March to redefine what “public service” means to ensure it aligns with his political views, PSLF borrowers told Business Insider that they’re worried the relief they’ve been counting on will be stripped away.
“I’m so close to the finish line,” Jeff Hughes, a state employee who has dedicated his career to public service, said.
Meanwhile, the resumption of collections for defaulted loans had borrowers in default or delinquency concerned that their federal benefits, like Social Security, were at risk of seizure. James Southern, a 60-year-old borrower with defaulted loans, said in May that he can’t afford his projected $1,500 payment, and he’s anticipating wage or benefits garnishment.
“They’re going to have to come and take it from me, and then I’ve got to figure out somehow how to live past that point,” Southern said.
Linda McMahon, Trump’s education secretary, said that the goal of resuming collections is to ensure borrowers are held accountable for repaying their debt. She has also reiterated that her goal to be the last education secretary remains, but the department has not yet specified plans for transferring student loans to another federal agency.
Regardless, the repayment limbo means that Knapp cannot retire from her public service nursing job until she receives answers on her repayment and relief timeline.
“It’s holding people captive,” she said. “You can’t live your life. You can’t move forward.”
Debt relief and repayment changes in the new year
The past year also brought some good news for borrowers — the Department of Education resumed processing student-loan forgiveness for borrowers on income-based repayment plans after months of stalled applications.
It was a huge relief for borrowers like Tammy Stinson, who have been paying off their student loans for over two decades.
“I feel like I might be free now,” Stinson, 52, told Business Insider in November. “I can actually live my life and hopefully retire before I’m 90.”
Still, thousands of borrowers are in limbo — a recent update from the Department of Education said that over 800,000 borrowers have pending income-driven repayment applications.
And with student-loan forgiveness comes new taxes in 2026. A 2021 provision in former President Joe Biden’s American Rescue Plan that made loan forgiveness tax-free is set to expire in January, meaning borrowers who become eligible for relief in the new year could face thousands of dollars in additional taxes.
“I absolutely would not be able to afford that,” Knapp said.
The Department of Education is also set to roll out big repayment changes beginning in July. They include a new Repayment Assistance Plan, which new borrowers can enroll in with the promise of forgiveness after 30 years. There are also new borrowing caps for graduate and professional students, as well as a revised definition of programs designated as “professional.”
While programs like medicine and law are included in the professional definition, others, like advanced nursing, are not. Nathan Mitchell, who is in school to be a Physician Assistant, told Business Insider that some of his nursing colleagues are considering turning to private lenders or leaving the profession altogether.
“It’s a very somber feeling,” he said.
