Student Loan Forgiveness Would Get Easier, Quicker for Many Under New Bill - Newsweek

A newly introduced bipartisan bill in Congress would make it significantly easier for many teachers, nurses and first responders to qualify for federal student loan forgiveness.

The Public Service Loan Forgiveness Inclusion Act of 2026 was introduced in the House on September 4 by Bill Foster, an Illinois Democrat, and Brian Fitzpatrick, a Pennsylvania Republican.

The legislation is looking to address one of the most persistent complaints about the Public Service Loan Forgiveness (PSLF) program: borrowers discovering years into repayment that the plan they chose does not qualify them for forgiveness.

“The rising cost of higher education is forcing more Americans to take on significant student debt. This financial burden can often discourage talented individuals from pursuing a career in public service,” Foster said in a statement. “It’s past time to expand which student loan repayment plans qualify for forgiveness and make the process easier to navigate.”

Student loan forgiveness is one of the most politically contentious issues in higher education policy today.

While the PSLF program promises federal loan cancellation after 10 years of qualifying public-service work and payments, many borrowers have struggled to navigate its complex eligibility rules.

According to Foster’s office, 97 percent of public servants who applied for PSLF have historically been denied.

The Trump administration has also ushered in a period of significant change in the federal student loan system. Congress's One Big Beautiful Bill Act established new repayment plans and policies and has also looked to limit which public service workers qualify for the PSLF. Federal court rulings have prevented Trump’s narrowed PSLF eligibility from going into effect.

The bill would expand the types of repayment plans that can count toward PSLF during a borrower's first 60 qualifying payments, which typically make up the first five years of required service.

“Right now, borrowers spend years working in qualifying public service jobs and making student loan payments only to discover that some of those payments don't count because they were in the wrong repayment plan,” Michael Ryan, a finance expert and the founder of MichaelRyanMoney.com, told Newsweek. “This bill would let payments under a broader range of plans count toward a borrower's first 60 PSLF payments.”

Currently, PSLF forgives remaining federal Direct Loan balances after a borrower works full time for a qualifying nonprofit or government employer and makes 120 qualifying monthly payments.

Today, however, qualifying plans generally include income-driven repayment programs like the Income-Based Repayment (IBR), Income-Contingent Repayment (ICR), Pay As You Earn (PAYE) and Repayment Assistance Plan (RAP).

But one of the biggest problems facing borrowers has been discovering after years of repayment that they were on the wrong plan, causing months or even years of payments not to count toward forgiveness. The new bill would provide added flexibility to make sure that doesn’t happen.

The legislation currently has one Republican co-sponsor, making it one of the relatively few bipartisan student-loan bills introduced this Congress.

“I'm less optimistic about its immediate chances of becoming law. It has bipartisan sponsorship, which helps, but right now that bipartisanship is pretty thin,” Ryan said.

“I'd call this a sensible fix with a credible policy argument behind it, but not a bill borrowers should start making financial decisions around yet.”

The proposal comes amid larger changes taking place for federal student loan programs under the Trump administration.

The recently enacted One Big Beautiful Bill Act created a new repayment structure and requires the eventual phaseout of the PAYE and ICR repayment plans by July 1, 2028.

PSLF is one of the federal government's most popular forgiveness programs because it offers complete debt cancellation after 10 years for qualifying public-service workers. Teachers, government employees, military personnel, as well as firefighters, police officers and nonprofit workers may qualify.

Despite this option, the Department of Education’s backlogs and processing delays have also sparked frustration recently among borrowers seeking forgiveness.

"Any progress towards opening up forgiveness is a positive for students," Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, told Newsweek.

However, he said he believes it has "no chance of being passed, at least not by this current administration."

"They are looking to contract, not expand, the reach of the federal government, so this is a nonstarter," Thompson said.

After being considered by the House Education and the Workforce Committee, it could face possible committee markups and amendments.

At that point, it could head to be voted on by the full House before being considered by the Senate and then heading to get a signature from President Trump.

Contact Newsweek editors on this story: Jason Lemon and Gray R. Thomas