Student loans for millions of federal borrowers won’t be halted under Trump’s funding freeze, the Education Department says

AOL

Ayelet Sheffey and Juliana Kaplan

January 28, 2025

Trump’s administration announced a temporary freeze on federal grants and loans set to begin Tuesday evening.

The Education Department said student loans and Pell Grants will not be impacted.

It’s still unclear which federal programs, like rental aid and nutrition assistance, will be impacted.

Some student loan borrowers won’t have to worry about President Donald Trump’s sweeping federal funding freeze.

The Department of Education said in a statement to Business Insider that the funding pause only applies to “discretionary grants” at the agency. The Department did not immediately clarify what is considered a discretionary grant. A federal judge temporarily blocked the freeze right before it was set to go into effect at 5 p.m. ET Tuesday.

“The temporary pause does not impact Title I, IDEA, or other formula grants, nor does it apply to Federal Pell Grants and Direct Loans under Title IV, HEA,” Madi Biedermann, spokesperson for the Department of Education, said in a statement. “The Department is working with OMB to identify other programs that are not covered by the memo.”

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