Student loan borrowers will have fewer repayment options under GOP megabill
Share this @internewscast.com

The Senate narrowly approved its spending megabill on Tuesday night. The House is aiming to vote on this legislation and send it to President Donald Trump by July 4. However, it’s uncertain if Republicans have enough votes to pass the bill in its current form.

Among various measures intended to decrease federal spending and increase tax revenue, the bill proposes significant changes for federal student loan borrowers.

Most student borrowing reforms, such as reduced limits on graduate loans, won’t affect borrowers who have finished school and are currently repaying. However, those planning to take out loans next summer and beyond, as well as an estimated 8 million borrowers awaiting further developments on the Saving on a Valuable Education income-driven repayment plan, can anticipate fewer repayment options if the House passes the bill unchanged.

The change to repayment plans could be one of the most impactful provisions of the bill for current and future federal student loan borrowers.

Two years to choose from two plans

The Senate’s bill narrows the number of repayment options currently available to federal student loan borrowers down to just two plans: a standard repayment plan and a new income-driven plan known as the Repayment Assistance Plan. Borrowers on any of the currently existing repayment plans, except the SAVE plan, will be able to keep their plans and monthly payments the same.

Borrowers whose loans are dispersed on or after July 1, 2026 and those currently enrolled in the SAVE plan — who are in an administrative forbearance since federal courts blocked the plan from going into effect in July 2024 — will have only the two repayment plan options.

Borrowers on the SAVE plan would likely have to choose another plan anyway if federal courts retain the temporary injunction against it. Under the Republicans’ legislation, those borrowers will have between July 2026 and July 2028 to choose a new plan. After July 1, 2028, borrowers will automatically be moved into the income-based repayment plan.

The new standard plan will give borrowers a fixed monthly payment to have their loans paid off between 10 and 25 years, depending on the size of their loans. The current standard plan has a loan term of 10 years, regardless of the amount borrowed.

The Repayment Assistance Plan will calculate monthly payments as between 1% and 10% of a borrower’s discretionary income, down from the current offerings that set payments at 10%, 15% or 20% of a borrower’s income.

One analysis found that borrowers’ monthly payments could spike by hundreds of dollars on RAP, compared with what their payments would be on the SAVE plan.

Share this @internewscast.com
You May Also Like

Zohran Mamdani Addresses Trump Threats: ‘Speaking Out Comes With Risks’

NEW YORK CITY (PIX11) – Zohran Mamdani, the Democratic nominee for New…

Bryan Kohberger Takes Plea Deal without Disclosing Motive

() As a judge accepted a plea deal from Idaho suspect Bryan…

Two Women Arrested After 5-Year-Olds Discovered Alone in Florida Shed

ALACHUA COUNTY, Fla. (WFLA) — Authorities in Florida have taken two women…

Skydiving Plane Veers Off New Jersey Runway into Forest, Injuring 15

Authorities reported that fifteen individuals were hospitalized after a skydiving plane veered…

Convictions Overturned: Former Chicago Detective’s Cases Reexamined in Court

CHICAGO (WGN) – Former Chicago Police Det. Reynaldo Guevara was a no-show…

Unity Graduate Kimball Transfers to SIU

TOLONO, Ill. (WCIA) — Unity grad Blake Kimball is taking his talents…

Trump’s Proposed Budget Bill Could Slash Billions from Senior Programs

SAVANNAH, Ga. () – Almost $500 billion in automatic cuts to Medicare…

Driver Issued Citation After Tractor-Trailer Overturns on I-26W, Spilling Chicken Carcasses

SPARTANBURG COUNTY, S.C. (WSPA)— A driver has been cited after a crash…

RCSO Receives $1.2 Million Grant for New Patrol Cars Before July 4th Holiday

AUGUSTA, Ga. ()- One of Sheriff Eugene Brantley’s biggest goals since he…

Father of Bryan Kohberger Victim Expresses Regret to Daughter for Accepting Plea Deal

() The father of Idaho murder victim Kaylee Goncalves apologized to his…

New Expedition Might Uncover Amelia Earhart’s Missing Aircraft

WEST LAFAYETTE, Ind. (WGN) Nearly 90 years after Amelia Earhart mysteriously disappeared while…

Utah Mother Facing Charges for Homicide Now Accused of Mortgage Fraud and Money Laundering

SUMMIT COUNTY, Utah (ABC4) — The Kamas mother who is accused of…