Many college grads with student loan debt opt to go into the nonprofit sector or government service in part, at least because of the Public Service Loan Forgiveness Program, which can provide student debt relief for workers.

But the Trump administration is limiting eligibility, and now nearly two dozen states are suing. Under a new rule, nonprofits that do work the administration objects to — like helping support transgender people or people in the U.S. without permission — could see employees disqualified from the loan forgiveness program.

The Public Service Loan Forgiveness Program cancels federal student debt for some workers in government or certain nonprofits after 10 years of payment. This rule change gives the Department of Ed broad authority to disqualify employers.

“They're weaponizing the program to punish governments and nonprofits that don't agree with the administration's ideological agenda," said Winston Berkman Breen, an attorney with Protect Borrowers, one of the groups suing the Trump administration over the change. "It really is impossible to confidently predict how this rule will be used."

That throws a big wrench into borrowers' long-term financial planning.

“There are some borrowers that are definitely panicking over this," said Betsy Mayotte, president and founder of the Institute of Student Loan Advisors.

Borrowers should sit tight while challenges move through the courts, even if the rule is upheld, she said; they’ll get some advance notice before they're impacted.

But this adds to an atmosphere of confusion, according to Jennifer Steele at American University.

“The idea of public service loan forgiveness is that it incentivizes people to work in public service, where they might earn less money,” she said.

The erosion of trust in the program could make it even harder for nonprofits and governments to recruit, Steele added.