Federal judges blocked President Trump's plan to restrict student loan forgiveness for government workers on July 1, 2026. A different ruling overturned the administration's broader loan forgiveness rule. These decisions came from courts in multiple states reviewing the policies. The Education Department increased loan limits for certain programs due to the court losses. Officials modified the rules to comply with the new legal environment. The public servant group had pushed for clarity on loan relief. The rulings impact how borrowers apply for forgiveness under current programs. Legal challenges will likely continue as the administration responds to the setbacks. This move reshapes the landscape for federal student aid policy.