The U.S. Department of Education is undergoing significant changes, with plans to cut nearly 50% of its workforce by March 2025. As the Trump administration aims to reduce or potentially eliminate the agency, the future remains uncertain for millions of students, parents, and educators concerning student loans, the Free Application for Federal Student Aid (FAFSA), and Individualized Education Programs (IEPs). Let’s break down the possible implications in a straightforward manner while keeping you informed.
When it comes to student loans, the $1.6 trillion federal portfolio isn’t going anywhere just yet—Congress would need to intervene to abolish it completely. The Federal Student Aid (FSA) office, responsible for overseeing loans and managing over $120 billion in disbursements annually, has been significantly impacted by the staff cuts, losing essential personnel who oversee everything from repayment plans to forgiveness initiatives.
“The concern is about delays and inefficiencies,” a former FSA employee shared with USA Today, suggesting that borrowers might experience slower responses to inquiries or loan modifications. Programs like Public Service Loan Forgiveness may face delays if the remaining staff can’t keep up with demand, but the loans themselves remain secure for now, likely transferring to another agency if the department closes.
Another critical aspect is FAFSA, which supports 17 million students seeking grants and loans. It is legally bound to the Higher Education Act, so it isn’t going away anytime soon; however, the budget cuts may disrupt its implementation. The struggles with last year’s FAFSA overhaul, which frustrated many applicants, could be compounded by fewer employees, leading to increased processing times. “We’re on track for the 2026-27 FAFSA by October 1,” stated Acting Under Secretary James Bergeron in a February statement. Unfortunately, staff shortages have already led to a four-hour outage shortly after the layoffs, according to The Washington Post. Institutions may also face challenges with delayed financial aid disbursements potentially leaving students in a tough spot.
Department of Education downsizing: Effects on loans and IEPs revealed
IEPs, which guarantee equitable educational opportunities for children with disabilities, are protected under the Individuals with Disabilities Education Act (IDEA). While the law remains intact, the enforcement may weaken. The Office for Civil Rights, now minimally staffed, is responsible for addressing discrimination complaints linked to IEPs and 504 plans.
“Families may encounter delays in resolving issues,” cautioned Brittany Coleman, a dismissed civil rights attorney, during an interview with the Washington Post. A lack of oversight could lead schools to neglect necessary accommodations, forcing parents to advocate more vigorously for their children’s rights.
As the Education Department undergoes this transformation, student loans, FAFSA, and IEPs are not disappearing—but the journey ahead may be challenging. Staying updated is crucial as these changes unfold.
