Public Citizen v. Department of Education (2026)

By statute, the Department of Education is required to cancel outstanding loan liability for student-loan borrowers who become “permanently and totally disabled.” Under the Department’s regulations, as soon as a borrower notifies the Department that he or she intends to apply for a “Total and Permanent Disability” (TPD) discharge, the Department is to suspend all collection activity on the borrower’s federal student loans for 120 days, and inform other loan holders to do the same. And when a borrower submits a TPD discharge application, the regulations require the Department to suspend collection activity until it makes a decision on the application, and direct other lenders to do the same. In early 2025, the Department “transitioned” responsibility for processing from one contractor to several others. Post-transition, numerous borrowers reported that the Department and loan holders were not suspending collection activity as required by the regulations.

In January 2026, Public Citizen submitted to the Department a Freedom of Information Act (FOIA) request for policies and other records related to suspensions of collection activity on student loans pending review of applications for TPD discharge. In October 2026, after the Department had failed to produce the requested records, Public Citizen filed suit under FOIA.