The US capitol on March 25, 2025 in Washington, DC (photo of Shauneen Miranda/States Newsroom)
Washington – students and families were able to see significant changes to the repayment of student loans and the reduction in state student aid, since the Republicans of the congress are trying to reduce billions of dollars for federal expenses in order to compensate for the costs for the comprehensive agenda of President Donald Trump.
The Republicans utilize the convoluted reconciliation process to move a package with elementary majority voices in each chamber through the congress, which avoids the 60-voice threshold of the Senate, for which a non-partisanity is generally required.
The House Committee for Education and the workforce has approved its part of the package in A Party line vote In April, press the GOP legislator one step closer to the potential securing of critical changes to the repayment options for student loans and the authorization of Pell Grant.
The chairman Tim Walberg, a Republican in Michigan, said the 103-page bill Taxpayers would save more than $ 350 billion and “urgently needed reforms in relation to” simplified repayment of loans, optimized student loan options and accountability for students and taxpayers “.
However, the legislation has drawn criticism and concern of student lawyers and congress democrats about how the proposed changes would affect the affordability and the access of university formation.
Aissa Canchola Bañez, Policy Director of the Student Lower Protection Center, told States Newsroom that the representative group was “really worried that the Republicans will pursue the university in their efforts to combat the afflection crisis.”
“Unfortunately, this law will make college more expensive for families and students and make it much more risky for students and families who only try to pay for college, and it will also be significantly more expensive for millions of borrowers across the country,” she said.
MP Bobby Scott, a rank member of the committee, repeated the concerns of student representative groups.
The Democrat of Virginia said the bill Would “increase costs for universities and students”, “restrict the access of the students to quality programs” and “take all so -called” savings “in order to pay more tax cuts for the affluent and well -networked.
Here is a breakdown of some of the most critical changes that are shown in the proportion of the House Education Panel package:
The law would be subsidized – in which the Federal Government pays interest rates for the loan, while a borrower is at school, for borrowers from July 1, 2026 according to the Summary of the committee.
For non -subsidized loans that were paid on or after July 1, 2026, the maximum annual loan limit for the “study programs of the students” would be changed.
The total amount of the Federal Student Aid, which a person could receive annually, would also be circumscribed to the “medium costs of college”. After CommitteeThis is defined as “the average costs for participation in students who are enrolled at the same study program at the national level and are used by the secretary (educational) secretary by using data from the previous price year.”
Total limit values ​​or the maximum amount that a student can borrow would limit $ 50,000 for Bachelor programs. 100,000 US dollars for graduate programs; and $ 150,000 for professional programs such as law or medical faculty.
The invoice also eliminates the Grade Plus program and puts on recent restrictions for parents and loans.
Students would have to be necessary to “exploit their non -subsidized loans before parents can use parents plus to cover their remaining presence costs,” said the committee.
Canchola Bañez found that the abolition of the Grad Plus program would boost the likelihood that the students would have to take out loans on the private market to close gaps that they normally utilize with degree plus loans.
“We know that private loans have much less protection and consumer protection,” she said, adding: “The more we push people from the federal market and the private market, the fewer students and borrowers have access to these protective measures if things should go wrong after school.”
“Skin accountability in the game”
The package also proposes “skin in play responsibility” for universities and universities, and the institutions would have to pay the Federal Government “a percentage of non-repayment balance paid with loans in or after July 1, 2027.
Preston Cooper, Senior Fellow in university policy in a right -wing Think Tank, the American Enterprise Institute, said: “Essentially for universities whose borrower demands part of this repayment support if your payments are too low to cover interest rates for your loans, or if you require this main loan, the universities must offer a share of costs.”
“You don’t have to cover all costs – the government will pay part of it – but you have to cover some of the costs for providing borrowers with this repayment aid, and I think the idea is to create better incentives for the universities to ensure that they do not load the students with unnecessary debt,” he said.
Pell Grant authorization
The legislation defines the full-time enrollment for Pell grants New-a subsidy of the federal government, which helps to pay low-income students for college.
Legislation increases the minimum number of credit hours to qualify for the maximum Pell Grant Award from 12 credit hours per semester to 15 credit hours. The students would also not be entitled to a pell grant if their student AID index-a formula-based number for determining the financial support that exceeds or exceeds the maximum pell subsidies.
Pell Grant’s authorization would also be expanded for those in tiny -term programs between eight and 15 weeks.
Lift of the memory plan
The legislation only creates two repayment plans bound before the Federal Supreme Court.
The standard repayment plan contains fixed monthly payments and repayment conditions between 10 and 25 years, depending on how much one CommitteeWhile the repayment aid plan calculates payments based on the entire adjusted gross income of a borrower.
The repayment aid plan also includes a monthly payment of at least $ 10 and “offers credit for borrowers who make their necessary time payments by foregoing unpaid interest and providing a suitable payment for a principle of up to $ 50,” says the committee.
Cooper said that the plan for repayment aid has “determined one of the long -term problems in the income -driven repayment system for student loans, which is that many borrower payments do not cover their accrued interest, which means that they increase their credit over time.”
