Congress Unveils Plan To Change Student Loan Repayment Plans

I am posting this because it involves many of us...

A new proposed reconciliation bill would overhaul federal student loans by setting stricter borrowing limits, ending Parent PLUS Loans, and creating new repayment rules for loans after July 1, 2026. Economic hardship and unemployment deferments, as well as some PSLF eligibility, would end for future borrowers.


Congress Unveils Plan To Change Student Loan Repayment Plans

 

I served my country for 32 years, but because of timing, I don't qualify for PSLF.

I "consolidated" my loans a couple of years ago. This lowered the monthly payments by 40%, which is all I care about. They'll be discharged when I'm about 87 (or sooner if, you know....).

 

“It's important to remember that this is the first work-up of proposals that are actually in print. Not all of these may make the final bill, and even then, they may change as well. That being said, many of these proposals mimic what was already proposed under the College Cost Reduction Act, and many are popular topics for Republicans.

Let's break down some of the major proposals (though there are many others as well - the bill is 100+ pages long).”


“Pell Grants And Workforce Grants
The bill would change the way Pell Grants are awarded by imposing a new limit based on the Student Aid Index (SAI), not just income. A student would not be eligible for a Pell Grant if their SAI is over a certain threshold, even if their family income would otherwise qualify. The goal here is to prevent "Pellionaires".

It would also create a "Workforce Pell Grant" for students enrolled in eligible short-term vocational programs. The Workforce Pell would offer funding for non-degree programs that meet specific federal criteria, expanding Pell access beyond traditional colleges.

The changes seek to target Pell aid more tightly at students with the greatest financial need, and to support workforce training programs aligned with growing labor market demands.”