Court blocks Trump-era student loan restriction for advanced degrees

This marks the third time a federal court has intervened to prevent the policy from being implemented. The proposed rule, initially slated to take effect on July 1st, would have capped borrowing for 11 professional degree programs, including dentistry and medicine, while excluding others like nursing and social work.

Those eligible programs would have faced a $200,000 lifetime borrowing cap, while other advanced degrees would have been limited to $100,000. The plan drew criticism from legislators and advocates who argued that some excluded programs necessitate higher borrowing limits to adequately fund students.

The Oregon ruling, issued last month, specifically addressed the naturopathic medicine field. Plaintiffs, including colleges and students, argued the exclusion could force students into private loans with higher interest rates and ineligibility for federal loan forgiveness. Associations representing naturopaths also voiced concerns about potential revenue losses if students opt not to enroll due to the borrowing caps.

Judge Michael Simon stated that the potential harm to students and educational institutions is “imminent,” particularly as students make enrollment decisions for the upcoming academic year. He issued a preliminary injunction against the Department of Education’s definition of “professional” and mandated that naturopathic medicine be included under the higher borrowing limit.

The Department of Education has advised students to consult with their schools to understand the impact of the court’s decision.

Prior to this, another court ruling in June also blocked the department’s revised definition of a professional degree. Consequently, the department released an updated list of 30 programs qualifying for a higher borrowing limit while the legal challenges continue. The department maintains confidence in the legality of its narrowed definition and intends to defend it.