Congress enacted a major spending package on July 3, which introduces significant changes to student loan repayments. Existing income-driven repayment plans will be eliminated and replaced by two less favorable options. New restrictions will also be imposed on borrowing limits for parent and graduate students. Additionally, the bill will limit the ability of borrowers to defer loans during financial hardships. Advocates express concern that this will increase the financial burden on student loan borrowers, exacerbating existing challenges with repayment.
Linda McMahon, Trump's education secretary, lauded the bill's passage in a post on X, saying that it 'simplifies the overly complex student loan repayment system' and 'reduces federal student loan borrowing amounts to help curb rising tuition costs.'
Sen. Elizabeth Warren said in a statement that student-loan payments will go up as a result of the legislation.
Natalia Abrams, president of the advocacy group Student Debt Crisis Center, said that 'this dangerous bill abandons millions of borrowers, leaving them with few, often inaccessible repayment options and deepening their financial insecurity.'
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