Student Loan Update: Forgiveness Process Is ‘Tedious,' McMahon Says

Education Secretary Linda McMahon on Tuesday described the current student loan forgiveness review process as "tedious," as the department faces a large backlog and several administrative hurdles.

Testifying before a Senate Appropriations subcommittee on the Department of Education's fiscal year 2027 budget, McMahon said her agency is working through thousands of pending cases tied to the Public Service Loan Forgiveness (PSLF) buyback program, a temporary option created under the previous administration to allow borrowers to retroactively receive credit toward loan forgiveness.

"We've been looking at the buyback program, which is established under the prior administration with a lot of regulations involved," McMahon said during the hearing.

"It's not established by law. There's an 8,000 backlog. It's very complex to verify employment of all the people applying in. It's tedious to do, but we are addressing this backlog. I want to make sure we have a long‑term solution."

Why Borrowers Are Stuck Waiting on Loan Forgiveness

The Public Service Loan Forgiveness buyback option was designed as a temporary fix for borrowers who lost credit toward forgiveness because of administrative pauses or loan status changes.

The 8,000 backlog reflects borrowers whose buyback applications are pending, not the total number of people eligible for or pursuing PSLF overall.

Why the PSLF Buyback Program Is So Backlogged

The PSLF buyback option allows eligible borrowers to make one‑time payments covering past months in which their loans were in deferment or forbearance, enabling those periods to count toward the 120 qualifying payments required for forgiveness.

During her testimony, McMahon said that verifying employment history across multiple years and employers has proven time‑consuming for the department.

McMahon did not provide a specific timeline for clearing the backlog but said the department is actively working through the cases.

‘Tedious' but Telling: What McMahon's Comments Signal on Forgiveness

"Doing employment verification for thousands of applications can be time-consuming and has led to frustration from borrowers eager to discover if they qualify and what is going to be the transition plan for them to a new income-driven repayment plan going forward," Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek.

"The reality is many are going to have to simply wait, and, in the meantime, continue to develop a plan for repayment regardless of the decision that’s reached."

During her testimony, the Education Secretary also defended President Donald Trump's proposed 2027 education budget, which calls for $76.5 billion in funding, a $2.3 billion reduction compared with the department's 2026 enacted level, according to the administration.

"When the Secretary of Education describes the student loan forgiveness process as ‘tedious’ and ‘very complex,’ borrowers should read that as a policy signal. Not a management complaint," Michael Ryan, a finance expert and the founder of MichaelRyanMoney.com, told Newsweek.

"The Trump admin has been systematically narrowing every forgiveness pathway available. Eliminating the SAVE plan, politicizing PSLF eligibility, and resuming default collections on 5.3 million borrowers."

During the hearing, McMahon said the department has "carefully scrutinized every dollar of taxpayer investment" and argued the restructuring is aimed at improving efficiency and accountability rather than reducing services to borrowers.

However, Democratic lawmakers raised concerns that staffing reductions and budget cuts could worsen backlogs across student aid programs.

"It also includes the continued focus on illegally dismantling the entire Department of Education," Senator Tammy Baldwin, Wisconsin Democrat, said about the cuts to the department. "None of this is about returning education to the states. The things you claimed to have returned – through waivers and flexibility – federal law already allowed."

What This Means for Public Service Borrowers Going Forward

The Trump administration's broader education budget proposal must still be reviewed and approved by Congress, and lawmakers have already signaled the plan is likely to face significant debate.

"For the hundreds of thousands of public servants waiting on PSLF processing, or the 7.5 million SAVE borrowers now scrambling for alternative plans, ‘tedious’ is a word that costs real money and real time," Ryan said.

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This story was originally published April 29, 2026 at 5:47 PM.