The new tax and public spending bill leads to major changes in the federal student loan system, impacting current and future borrowers. Effective July 1, 2026, only two repayment options will be available to new borrowers: a standard repayment plan and a new income-based repayment option. Existing borrowers may retain some current options temporarily, while a new Repayment Assistance Plan eligible for PSLF aims to simplify loans. Challenges include staffing issues at the Office of Federal Student Aid affecting the transition and legal uncertainties for borrowers enrolled in the previous SAVE plan.
The new tax and public spending bill signed by President Donald Trump significantly alters the federal student loan system, affecting both current and future borrowers.
Starting July 1, 2026, the Department of Education will only offer two repayment options for new borrowers: a standard plan or a new income-based repayment plan.
A new Repayment Assistance Plan (RAP) will be eligible for PSLF, but the Trump administration seeks to restrict PSLF eligibility while simplifying repayment for borrowers.
Transition challenges arise from staff cuts at the Office of Federal Student Aid, leaving current borrowers in legal limbo regarding the SAVE plan.
#student-loans #federal-education-policy #income-based-repayment #public-service-loan-forgiveness #trump-administration
Collection
[
|
...
]