Why Mohela is Telling Borrowers to Refile Their IDR Forms

Confused by Mohela’s New Notice? Here’s What You Need to Know

If you submitted an income-driven repayment (IDR) application before May 2025 and haven’t heard back from Mohela, you may be at risk of falling through the cracks. Mohela, one of the largest federal student loan servicers, recently asked borrowers to refile to avoid processing delays that could jeopardize their monthly payments.

Catalina, CEO of LoanSense, broke down this critical update in a recent video, along with details on the upcoming “One Big Beautiful Bill” in Congress that could transform federal student loans.

Here’s what you need to know — and what steps to take now to protect your finances.

Mohela Is Asking Borrowers to Refile Their IDR Applications

Mohela has been overwhelmed by a huge backlog of IDR and SAVE plan applications. Borrowers who filed before the end of April 2025 and haven’t received a confirmation should refile as soon as possible.

Pro tip: If your income has gone down since last year, avoid using the IRS data link on studentaid.gov, because that will pull your higher previous income. Instead, use alternative income documents.

LoanSense can help you file directly with your loan servicer to bypass the long studentaid.gov processing queue. This helps get your application confirmed faster and prevents missing paperwork issues.

👉 Schedule a free LoanSense consult to avoid costly mistakes.

Why Mohela Has a Backlog

Here’s what caused the chaos:

• Massive enrollments in the SAVE plan
• Payment pauses and restarts under past federal rules
• Servicers having to remove and re-enroll millions of borrowers in autopay
• Flooded systems after the Trump-era filing freeze was lifted
  

This created a perfect storm of processing delays. If you haven’t heard from Mohela since submitting your IDR paperwork, act now to make sure your new plan is approved before payments resume.

What Happens if You Don’t Refile?

If you don’t resubmit, you risk:

✅ Being auto-enrolled into a plan you didn’t choose
✅ Getting stuck with a higher monthly payment
✅ Missing out on lower payments tied to your current income

Mohela is prioritizing applications from single borrowers, but married borrowers and those with dependents could see additional delays.

Big Changes Coming: The “One Big Beautiful Bill”

Catalina also explained key provisions in the One Big Beautiful Bill under debate in Congress:

• Starting July 1, 2026, borrowers will only have two repayment choices for new loans: the Standard Plan or a Repayment Assistance Program
  
• Repayment Assistance will use adjusted gross income instead of discretionary income, with payments capped at 10% of AGI
  
• Repayment Assistance will run 30 years, longer than current plans, but with benefits like unpaid interest forgiveness
  
• Subsidized limits for graduate borrowers (max $20,500/year, $100,000 total) and professional students (up to $50,000/year, $200,000 total)
  
• Parent PLUS borrowers will lose income-contingent repayment after July 2026 unless they consolidate before then
  
  

We strongly recommends borrowers actively pick a repayment plan instead of letting the government auto-assign one.

“It’s better to choose what works for you than let someone else choose for you.” — Catalina Kaiyoorawongs

Should You Act Now or Wait?

LoanSense’s guidance:

✅ Refiling now is wise if you applied before May and haven’t heard back
✅ Review your income and family size to see if IDR or the new repayment assistance program works best
✅ Book a quick consult with LoanSense if you’re unsure which plan is right

The final Senate vote on the One Big Beautiful Bill could happen before July 4th, so staying informed is critical.

How LoanSense Can Help

👉 If you’re worried about getting stuck in a 30-year repayment plan, higher payments, or paperwork mistakes, LoanSense can:

• Submit your application directly to your servicer
• Provide alternative income documentation support
• Help you choose the best repayment plan based on your income and family
  
  

👉 Talk to a LoanSense Advisor for free