Student-loan borrowers are legally entitled to debt relief — but they’re still waiting for it to arrive, a new court filing says.
The Project on Predatory Student Lending — a borrower advocacy group — filed a new motion in its years-long lawsuit to get relief for thousands of defrauded borrowers.
In July, a federal court denied the Trump administration’s request to delay relief under the Sweet v. McMahon settlement, which has provided $23 billion in relief to over 500,000 borrowers. Now, PPSL says that over 1,000 members of the settlement class are still waiting for loan discharges or refunds that the Education Department “was legally required to provide by deadlines that have long since passed.”
The group filed a motion asking the court to enforce the settlement and hold the department in contempt, in order to compel compliance with the settlement terms and process relief within the set deadlines. Specifically, the motion asks the department to resume weekly meetings with the plaintiffs’ counsel for status updates on the processing of the relief, and asks the court to enforce penalties if the department does not comply.
The Education Department said in its response that the motions are “baseless.”
Additionally, a declaration from the department’s ombudsman said that borrowers still awaiting refunds are not due to department failure, but rather, that those borrowers’ accounts “warranted further review.”
“Although it has taken staff some time to understand all of the complexities, the current staff have been reviewing and resolving Sweet complaints since approximately April 2024 with some staff added in 2025,” the ombudsman said. “They are all incredibly well-versed in Sweet complaint resolution.”
A public hearing in the case is scheduled for November 5.
Student-loan borrowers first filed a lawsuit against the department in 2019, accusing it of failing to process their borrower defense to repayment applications — claims borrowers can file if they believe they were defrauded. If approved, their student debt from the school would be wiped out.
A settlement in the case was reached under the Biden administration in 2022, and while batches of borrowers have received relief, PPSL said that others who qualify are still waiting.
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