Student loan cancellation program could become Trump retribution tool, some advocates fear

Source: Associated Press

Student loan cancellation program could become Trump retribution tool, some advocates fear

By COLLIN BINKLEY
Updated 3:06 PM EDT, July 7, 2025

WASHINGTON (AP) — President Donald Trump is reshaping a student loan cancellation program into what some fear will become a tool for political retribution, taking aim at organizations that serve immigrants and transgender youth.

The Education Department is preparing an overhaul of the Public Service Loan Forgiveness program that would strip the benefit from organizations involved in “illegal activities” and allow the U.S. education secretary to decide which should lose eligibility. A draft proposal released by the department includes definitions of illegal activity that center on immigration, terrorism and transgender issues.

Several advocates invited to weigh in on the draft proposal raised concerns it would give the department subjective authority to decide if an organization is engaged in anything illegal — a power that could be used to remove entire hospital systems or state governments from the program.

“That’s definitely an indicator for me that this is politically motivated and perhaps will be used as a tool for political punishment,” said Betsy Mayotte, president of the Institute of Student Loan Advisors and one of the advocates asked to review the policy as part of a rulemaking process.

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Read more: https://apnews.com/article/student-loan-forgiveness-public-service-trump-145f6a07a477e5c82f4374bc89e1eea7