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Rep. Ilhan Omar and Rep. Greg Casar Lead 49 Lawmakers in Demanding Trump Administration Reverse $27 Billion Student Loan Interest Hike

July 31, 2025

WASHINGTON – Today, Rep. Ilhan Omar (D-MN) and Rep. Greg Casar (D-TX) led a letter with nearly 50 House Democrats calling on Education Secretary Linda McMahon to immediately reverse the Department of Education’s decision to resume charging interest for nearly 8 million borrowers enrolled in the Saving on a Valuable Education (SAVE) plan, beginning August 1. The abrupt policy change threatens to saddle working families with over $27 billion in unnecessary interest charges in just 12 months. 

“The Trump Administration’s calloused decision to resume interest charges for nearly 8 million borrowers trapped in the crosshairs of baseless and partisan lawsuits, and attempting to hide behind court injunctions to do so, is a deliberate abdication of your responsibility to protect students and borrowers,” the Members wrote. “We call on you to immediately reverse this policy so that millions of borrowers are not forced to pay billions of dollars in unjust and unnecessary interest charges.”

In the letter, the lawmakers emphasize that no court has deemed the SAVE plan illegal, nor required the Department to resume charging interest. Despite this, the Trump Administration is moving forward with the change, falsely claiming legal obligation and attempting to deflect accountability. 

The letter highlights that borrowers placed into forbearance, due to ongoing right-wing legal challenges to SAVE, were promised protection from financial harm. Resuming interest accrual would result in average annual interest charges of $3,500 per borrower, or roughly $300 per month. The lawmakers also raised concerns about the Department’s failure to process more than 1.5 million pending income-driven repayment applications, with recent reports that it will flatly deny 460,000. These operational failures have left borrowers with no viable repayment alternatives while interest begins to accrue. 

“Instead of fulfilling their promises to lower everyday costs for the American people, President Trump and Secretary McMahon are choosing to push millions of borrowers even further into debt by  saddling them with more than $27 billion in unnecessary interest charges– all while attempting to hide behind unrelated court cases to get it done” said SBPC Policy Director Aissa Canchola Banez. “Raising student loan costs by resuming interest charges is a cruel and calloused policy choice that will make it even harder for millions of working families to make ends meet. We applaud Representative Omar and Representative Casar for leading nearly 50 of their House colleagues to stand up for millions of working families with student debt and demand that Secretary McMahon reverses course.

The letter was signed by Reps. Alma Adams, Nanette Barragán, Don Beyer, Brendan Boyle, Troy Carter, Sheila Cherfilus-McCormick, Judy Chu, Yvette Clarke, Lou Correa, Joe Courtney, Mark DeSaulnier, Sarah Elfreth, Veronica Escobar, Dwight Evans, Cleo Fields, John Garamendi, Chuy García, Sylvia Garcia, Glenn Ivey, Jonathan Jackson, Pramila Jayapal, Bill Keating, Summer Lee, Jennifer McClellan, Betty McCollum, LaMonica McIver, Gwen Moore, Eleanor Holmes Norton, Alexandria Ocasio-Cortez, Brittany Pettersen, Chellie Pingree, Mark Pocan, Ayanna Pressley, Mike Quigley, Delia Ramirez, Luz Rivas, Jan Schakowsky, Lateefah Simon, Darren Soto, Mark Takano, Shri Thanedar, Rashida Tlaib, Paul Tonko, Lori Trahan, Nydia Velázquez, Maxine Waters, and Frederica Wilson.

The full letter is available here

Issues:Education