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Repayment Plans

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Federal student-loan overhaul takes effect July 1, reshaping repayment and borrowing caps
education10 days ago

Federal student-loan overhaul takes effect July 1, reshaping repayment and borrowing caps

A sweeping overhaul of the federal student loan program signed by President Trump takes effect July 1, 2026. It introduces a new tiered standard repayment and a Repayment Assistance Plan (RAP) for new loans, caps graduate and Parent PLUS borrowing, and phases out existing repayment plans by 2028. Current borrowers won’t see immediate changes, but they’ll be transitioned to new options later. Auto‑pay discounts rise to 1% through September 2028, and critics warn the new rules could raise costs or reduce borrowing access for some students, even as supporters say the reforms simplify the system and improve loan health.

via CNN|
#education#federal-loans#grad-plus
July's Federal Student-Loan Overhaul: RAP Debuts, Caps Tighten, PSLF Rules Shift
politics19 days ago

July's Federal Student-Loan Overhaul: RAP Debuts, Caps Tighten, PSLF Rules Shift

Starting July 1, the federal student-loan system undergoes a sweeping overhaul: a new Repayment Assistance Plan (RAP) will consolidate income-driven options with payments roughly 1%–10% of income and forgiveness after 30 years; the Biden-era SAVE plan ends, with about 7 million borrowers transitioning to new plans and many seeing higher monthly payments; legacy plans like PAYE and ICR will be phased out by 2028; new borrowing caps tighten Parent PLUS and Grad loans, Grad PLUS for new borrowers ends, and PSLF criteria are updated; there’s also a 1% auto-pay interest-rate reduction through 2028. Borrowers will receive 90-day notices and must act to choose a plan or risk automatic placement into a standard plan with fewer benefits.

via Yahoo|
#federal-student-loans#politics#pslf
Education Dept Moves 7.5 Million Borrowers Off Biden's SAVE Plan to Simplify Student Loans
politics19 days ago

Education Dept Moves 7.5 Million Borrowers Off Biden's SAVE Plan to Simplify Student Loans

The Education Department announced a major shift to streamline Biden-era student debt programs: about 7.5 million SAVE plan borrowers will have 90 days to exit starting July 1 and be directed toward two Trump-era repayment options (the Repayment Assistance Plan and the Tiered Standard Plan). SAVE borrowers collectively owe roughly $365 billion; the department says the current system’s 40+ options are overly complex and created bottlenecks, with the Biden plans slated to be shut down by 2028. More than 300,000 SAVE borrowers have already moved to RAP, which requires payments of 1–10% of earnings and forgives remaining debt after 30 years if not fully paid; the Tiered Standard Plan can extend repayment up to 25 years. The move follows a court ruling that struck down the original income-driven plan, and the department says this is about simplifying access and placing responsibility on Congress rather than the department.

via New York Post|
#biden-administration#education-policy#politics
New era in US student loans as repayment rules tighten from July 1
business25 days ago

New era in US student loans as repayment rules tighten from July 1

The US is overhauling its federal student-loan repayment system: the Save plan ends July 1 after a court ruling, forcing borrowers to pick a new plan within 90 days; existing loans can use IBR, PAYE, or ICR or be moved to fixed plans, though most of these will tighten forgiveness and be phased out by 2028. New borrowers will get RAP and a tiered standard plan, while fixed plans often require higher payments, signaling a shift toward less forgiving terms and sparking concern among graduates.

via The Guardian|
#business#debt-repayment#federal-student-loan
7 Million SAVE Borrowers Face Higher Payments Under New Repayment Rules
education1 month ago

7 Million SAVE Borrowers Face Higher Payments Under New Repayment Rules

Starting July 1, the Education Department will warn borrowers on the SAVE income-driven plan to switch to a different repayment option. If they don’t act within 90 days, they’ll be automatically placed in either the standard or the new tiered standard plan, both generally more expensive than current income-driven options. The tiered standard plan would require paying off the principal over a set term with a $50 minimum monthly payment, while the Repayment Assistance Plan (RAP) would base payments on adjusted gross income and is also costlier than existing options. Lawmakers are urging automatic enrollment in the cheapest available plan, while the changes coincide with broader provisions from a recent spending bill that affect borrowing limits for advanced degrees and parental loans.

via Business Insider|
#education#education-policy#rap
Three Dates That Will Reshape Federal Student Loans This Summer
money1 month ago

Three Dates That Will Reshape Federal Student Loans This Summer

Federal student loans are set for sweeping changes this summer: June 15 will bring discharge notices for the last group of Sweet v. McMahon Borrower Defense applicants; June 30 is the consolidation deadline for Parent PLUS loans to preserve IDR eligibility and forgiveness options; and July 1 introduces the RAP repayment plan, winds down the SAVE plan, and imposes new PSLF limits plus a Tiered Standard option, so borrowers should consolidate by June 30 if possible and get ready for tighter repayment and forgiveness rules going forward.

via Forbes|
#consolidation#federal-student-loans#loan-forgiveness
Eight Federal Student-Loan Shifts Borrowers Must Watch Ahead of July 1
education1 month ago

Eight Federal Student-Loan Shifts Borrowers Must Watch Ahead of July 1

Federal student-loan policy is tightening before July deadlines: the SAVE plan has ended and borrowers must pick a new repayment plan within 90 days; ICR and PAYE are being phased out by 2028, leaving Standard or RAP (1–10% of AGI) with a $10 minimum and 30-year forgiveness. Parent PLUS loans must be consolidated and placed in an IDR by July 1, 2026 to keep benefits, with existing borrowers potentially remaining on current plans until 2028. New borrowing limits take effect July 1, 2026 (e.g., up to $65,000 lifetime for Parent PLUS; graduate loans $20,500/year; professional loans $50,000/year). Existing Parent PLUS loans face no limits for up to three more years. Deferment and forbearance programs are being eliminated for newer loans starting July 1, 2027, with forbearance capped at nine months every two years. FAFSA remains required and private loans remain available; borrowers should check studentaid.gov for current options.

via Yahoo Finance|
#borrowing-limits#education#federal-policy
July 1 Launch for Trump's Student-Loan Overhaul Brings New Plans and Caps
education1 month ago

July 1 Launch for Trump's Student-Loan Overhaul Brings New Plans and Caps

On July 1, the sweeping student-loan overhaul is set to take effect, introducing two new repayment plans—Repayment Assistance Plan (RAP) and a tiered standard plan—while phasing out the SAVE plan. RAP ties monthly payments to income (1%–10% of AGI) with 30-year forgiveness, and the tiered plan bases terms on loan principal with a $50 minimum monthly payment; borrowers who took out loans after July 1 will only have RAP or the tiered option. The SAVE plan is ending, forcing about 7 million borrowers to transition within 90 days or be auto-placed on a standard or tiered plan. New lifetime borrowing caps are set at $100,000 for graduate students and $200,000 for professionals (11 programs max), with a $65,000 cap per child for Parent PLUS. Critics warn higher monthly bills for some and potential shifts to riskier private loans, and lawsuits over the policy continue.

via Business Insider|
#borrowing-caps#education#rap
July 1 Overhaul Restricts Repayment Options for New Federal Student Loans
business1 month ago

July 1 Overhaul Restricts Repayment Options for New Federal Student Loans

Starting July 1, anyone taking on new federal student loans will be labeled a 'new borrower' and face only two repayment paths (RAP and Tiered Standard), effectively eliminating access to IBR and other plans for new debt; existing borrowers keep some options, while Parent PLUS loans after July 1 lose PSLF eligibility; unemployment or economic hardship deferments are phased out for new loans; consolidating after July 1 is treated as a new loan; borrowers should reassess borrowing, consider who takes out loans, and weigh private loans carefully.

via CNBC|
#business#consolidation#ibr
New Tiered Repayment Options for Federal Student Loans Approaching Launch
business1 month ago

New Tiered Repayment Options for Federal Student Loans Approaching Launch

Two new tiered repayment plans for federal student loans are set to launch in about four weeks, expanding income-based options by tying monthly payments to income and debt levels; the changes could lower payments for lower earners and allow faster payoff for higher earners, but may affect overall interest costs and forgiveness dynamics, with enrollment details to be announced through official portals.

via Forbes|
#borrowers#business#education-finance
Treasury to Oversee Federal Student Loans in Phased Takeover
policy3 months ago

Treasury to Oversee Federal Student Loans in Phased Takeover

Education Department will transfer the $1.7 trillion federal student-loan portfolio to the Treasury in phases, starting with about 9 million defaulted accounts; Treasury will handle default-collections and advise borrowers on returning to repayment, while borrowers should keep paying through their current servicer and watch for new repayment options. Advocates warn the move could worsen hardship and that Treasury lacks borrower-rights expertise; the shift follows a January pause on collections and comes as Biden’s SAVE plan is eliminated and Trump’s repayment overhaul pushes millions into new plans. The exact timeline for the pause and full rollout remains unclear.

via Business Insider|
#defaulted-loans#federal-student-aid#policy