Changes are coming to student loan policies in the U.S., and if you have federal student loans, it’s time to pay attention.
The Biden administration made historic moves in student loan forgiveness, canceling debt for millions of borrowers.
However, with a potential Trump administration on the horizon, the landscape could shift dramatically.
If you’re wondering how these changes might affect you, let’s break it down—straight to the point, no fluff.
What’s at Stake?
Student loans have been a major financial burden for millions of Americans.
The Biden administration introduced the SAVE plan, which lowered monthly payments, reduced interest accumulation, and offered loan forgiveness after a set period. More than 5 million borrowers benefited from debt cancellation under Biden’s policies.
However, a potential Trump administration—alongside Republican-led proposals—could take student loans in a different direction.
Read: What Happens to Student Loans if the Department of Education Shuts Down?
The focus? Cutting costs for the government, eliminating forgiveness programs, and restructuring repayment plans.
Here’s what might change:
Changes You Need to Know
- End of the SAVE Plan - Biden’s SAVE (Saving on a Valuable Education) plan was designed to help borrowers by lowering payments based on income and forgiving remaining debt after a certain number of years. Republicans argue that this program costs taxpayers too much and propose eliminating it—saving an estimated $127 billion over 10 years.
- No More Parent PLUS Loans - Currently, parents can take out PLUS loans to help their children pay for college. This option could disappear, shifting more financial responsibility to students.
- Graduate Student Loans in Jeopardy - Graduate students rely on PLUS loans to fund master’s and doctoral programs. Under proposed changes, these loans would be eliminated—making advanced degrees harder to afford.
- No More Student Loan Interest Deductions - Right now, borrowers can deduct up to $2,500 in student loan interest from their taxes each year. That tax break could be removed, increasing the financial burden on those still repaying loans.
Who’s Eligible for Forgiveness Right Now?
While future policies remain unclear, some borrowers are still eligible for forgiveness under existing programs like:
- Public Service Loan Forgiveness (PSLF): For those working in government or nonprofit jobs.
- Income-Driven Repayment (IDR) Forgiveness: Forgives remaining debt after 20-25 years of payments.
- Teacher Loan Forgiveness: Provides up to $17,500 in forgiveness for teachers in low-income schools.
- Biden’s Recent Forgiveness Expansions: More than 5 million borrowers have already received forgiveness under new IDR adjustments. Check your eligibility here.
The student loan system is complex and constantly evolving.
If a Trump administration returns, expect major policy shifts—possibly making repayment more expensive for borrowers.
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