A federal judge in Boston blocked the Trump administration on Tuesday from enforcing a new student loan rule that would have stripped some public service workers of eligibility for federal forgiveness. The ruling by US district judge Myong Joun stopped the regulation before it could take effect on 1 July.
The move lands squarely in the Public Service Loan Forgiveness Program, a system that wipes out federal student debt after 10 years of qualifying work for government or non-profit employers. More than a million borrowers have already received relief since Congress established the program in 2007, which is why the administration’s attempt to narrow it had immediate consequences for borrowers in the Public Service Loan Forgiveness Program.
The blocked rule would have let the US Department of Education decide that certain employers had a “substantial illegal purpose” and then cut their workers off from the program. That definition was broad enough to reach groups supporting immigration rights, transgender healthcare and other causes the Trump administration disfavors. In October, the department published the final rule spelling out that standard, including activities it described as aiding illegal immigration, supporting terrorism, engaging in illegal discrimination or participating in the chemical and surgical castration or mutilation of children.
The clash is about more than one loan program. In a March 2025 executive order, Donald Trump said the forgiveness system had misdirected tax dollars into activist organizations that “not only fail to serve the public interest, but actually harm our national security and American values.” Democratic-led states, cities and non-profits answered that the rule was written to target groups the administration dislikes, not to police loan eligibility in any neutral way. Joun sided with those challengers and found enough reason to block the rule before borrowers could be pushed out of the program.
Tuesday's ruling was the second court loss for the Trump administration's effort to remake the federal student loan system in the past week. On Wednesday, another judge in Washington DC barred the education department from carrying out a separate rule that would have lowered federal student loan limits for people pursuing graduate degrees in nursing and other healthcare-related fields. For now, the blocked forgiveness rule cannot take effect, and the bigger fight over how far the administration can go in reshaping student lending is heading back toward the courts.
