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Student Loans

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Debt surge could hit family budgets, student loans, and retirees
national9 days ago

Debt surge could hit family budgets, student loans, and retirees

With the national debt nearing $40 trillion, economists warn persistent deficits will raise borrowing costs and affect everyday finances: higher student-loan payments, pricier mortgages, and potential Social Security cuts unless policy changes occur. The Conference Board’s analysis notes a 2028 incoming student with a $45,000 loan could owe about $279,000 (or roughly $466,000 in extreme rate conditions); a $600,000 home with 20% down could total around $2.89 million (rising to about $3.64 million in a shock scenario); and Social Security insolvency could occur by 2032 unless taxes rise or deficits shrink. Small-business lending would also face higher costs, and lawmakers have largely stalled on decisive action.

via The Center Square|
#deficits#mortgages#national
politics17 days ago

Student-loan relief in gridlock as Democrats block GOP interest-cap plan

A GOP bid led by Rep. Luna to use a discharge petition to cap federal student loan interest at 2% faces Democratic resistance, with Democrats pushing their own bills and arguing GOP changes would worsen affordability. The clash highlights midterm tensions over higher-education costs as lawmakers weigh costs, offsets, and political strategy.

via Politico|
#congress#debt-relief#discharge-petition
RAP Deepens the Marriage Penalty for Federal Student Loans
personal-finance19 days ago

RAP Deepens the Marriage Penalty for Federal Student Loans

The Education Department’s Repayment Assistance Plan (RAP) bases monthly payments on adjusted gross income (AGI) and ranges from 1% to 10% of AGI, which can widen the “marriage penalty” for couples who file jointly because combined incomes push payments higher. Filing separately can significantly lower IDR payments for some borrowers, but may reduce tax benefits and increase complexity. The effect is smaller when both spouses have loans. RAP also offers a $50-per-dependent discount, which isn’t double-dipped by separate filers. Standard repayment plans are fixed and not affected by filing status. Advisory tip: enroll in autopay for a 1% interest-rate discount through 2028 if you sign up by September; and note that a 2022 law allows married couples to separate their loans rather than consolidate.

via CNBC|
#idr#marriage-penalty#personal-finance
Debt returns to haunt millions as student loan defaults spike
education1 month ago

Debt returns to haunt millions as student loan defaults spike

Defaults on federal student loans surged after pandemic relief ended, with about 9.5 million borrowers in default by early 2026 and more than 4.2 million adding to defaults since 2025. The upheaval follows a rollout of changes to income-driven repayment and the dismantling of the SAVE plan, triggering wage garnishments, damaged credit, and sharply higher monthly payments for many. Borrowers—often from for-profit schools or with loans transferred among servicers—describe confusion and stress as they try to restart their lives, with some hoping PSLF or other forgiveness paths might help, even as the overall system remains chaotic and opaque.

via Yahoo Finance|
#bankruptcy#defaults#education
Parental Help Is the New Path to the American Dream
economy1 month ago

Parental Help Is the New Path to the American Dream

The CNN piece argues that the traditional route to wealth—college, work, saving, and buying a home—now increasingly depends on family financial help. With rising costs and debt, many young adults rely on parents for ongoing support, and some households have inherited large sums that jump‑start homeownership or retirement. Fed data show nearly half of adults ages 18–29 received nonresident assistance for recurring expenses, and about as many live with parents, underscoring how access to the “American dream” now hinges on family wealth and support rather than earnings alone.

via CNN|
#economic-inequality#economy#family-support
Federal student-loan overhaul takes effect July 1, reshaping repayment and borrowing caps
education1 month 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
Mass. Judge Blocks Trump-Era PSLF Eligibility Rules for Public Servants
higher-education1 month ago

Mass. Judge Blocks Trump-Era PSLF Eligibility Rules for Public Servants

A federal judge in Massachusetts (U.S. District Judge Myong J. Joun) struck down the Trump administration’s revised Public Service Loan Forgiveness eligibility rules, ruling they unlawfully allowed disqualification of employers for DEI or other policy positions not enacted into law, and the decision came just before the PSLF rule was to take effect.

via The Washington Post|
#donald-trump#higher-education#lawsuits
Court Order Expands Higher Grad-Loan Eligibility for Select Professions
education1 month ago

Court Order Expands Higher Grad-Loan Eligibility for Select Professions

A federal judge paused the Education Department’s narrowed definition of 'professional degree,' allowing more graduate programs to qualify for the higher $50,000 annual loan cap (up to $200,000 total) instead of the $20,500 cap for other grads; the updated list now includes more than 20 degrees, such as nursing, physician assistants, and speech-language pathology, though the list could still change and the caps themselves remain in place.

via CNBC|
#courts#education#federal-aid
Pandemic pause leaves borrowers more indebted as payments restart
business2 months ago

Pandemic pause leaves borrowers more indebted as payments restart

A Washington Post analysis finds that while the pandemic pause on federal student loan payments reduced immediate financial strain, many borrowers used the extra time to incur other debts, and delinquencies have risen since payments resumed, with older and lower-income borrowers most affected. Although the pause was extended, new repayment options may still strain household finances.

via The Washington Post|
#business#debt#economic-policy
Court Rejects ED's Narrow 'Professional' Degree Rule for Student-Loan Caps
education-policy2 months ago

Court Rejects ED's Narrow 'Professional' Degree Rule for Student-Loan Caps

A federal judge in the District of Columbia voided the Education Department’s rule that narrowly defined 'professional' degrees for higher loan borrowing caps under the One Big Beautiful Bill Act, saying Congress intended the statutory definition to govern and that ED’s extra eligibility criteria went beyond what law requires. The ED had limited higher loan eligibility to 11 programs (e.g., pharmacy, dentistry, law, medicine, etc.), excluding others from the higher caps. Howell stayed the rule pending further litigation; the ED is reviewing the ruling and has not indicated whether it will appeal. The decision creates uncertainty about which programs qualify as 'professional' and could impact funding for advanced healthcare and other fields.

via Inside Higher Ed|
#court-decision#education-policy#higher-education