How will Trump's spending bill impact student loans?
Here's what the Republicans' domestic policy bill means for current and former students
 
 
President Trump's recently passed spending package has implications well beyond the tax code. It will also introduce some major changes for student loan borrowers.
In short, the bill will "roll back student loan protections and cap the amount students can borrow for graduate programs," said The New York Times, making repayment options and borrowing opportunities fewer. While the changes are projected to result in government savings, there are concerns that they could further reduce college affordability.
Here are some of the major changes to note.
The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
 
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Repayment plans will be reduced to just two options
The new law "eliminates many loan repayment options for student borrowers, reducing available repayment options from a dozen to two," said U.S. News & World Report. Borrowers will soon have just two plans to choose from: a standard repayment plan and a new income-driven plan called the Repayment Assistance Plan.
The Repayment Assistant Plan, like existing income-driven plans, is "based on borrowers' adjusted gross income and number of dependent children," though it "gives less flexibility on repayment for borrowers in financial difficulty than previous income-based plans and creates a $200,000 federal student loan limit," said U.S. News & World Report.
Some borrowers will be able to keep their existing payment plan despite the new legislation. However, "those currently enrolled in SAVE, ICR or PAYE plans will have only the two repayment plan options," as will "borrowers whose loans are dispersed on or after July 1, 2026," said CNBC Make It.
Lifetime borrowing limits will be reduced for some borrowers
Under the new bill, graduate school, professional program and Parent PLUS loan borrowers will face limits on how much they can take out.
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
"The move will cap the amount of federal loans students can borrow for graduate school to $20,500 a year — with a total limit of $100,000 — and cap loans for professional programs, such as medical, dental or law school, at $50,000 a year, with a total limit of $200,000," said NBC News. Previously, the graduate PLUS program allowed borrowers to take out "up to the full cost of attendance for their education," said Business Insider.
Meanwhile, the Parent PLUS program, which "allows parents to take on student loans for their kids' educations," will now have "a $65,000 lifetime cap," said Business Insider.
Deferment will no longer be offered
Previously, a borrower could "apply for an economic hardship or unemployment deferment, which would allow them to pause their monthly bills and not accrue interest for an allotted amount of time, up to 9 years," said U.S. News & World Report. That will no longer be an option under Trump's One Big Beautiful Bill Act.
While forbearance is still available to temporarily pause loan payments, the bill places "new limits" on it, stating that "loans can't be in forbearance for more than nine months during any 24-month period," said Forbes.
Becca Stanek has worked as an editor and writer in the personal finance space since 2017. She previously served as a deputy editor and later a managing editor overseeing investing and savings content at LendingTree and as an editor at the financial startup SmartAsset, where she focused on retirement- and financial-adviser-related content. Before that, Becca was a staff writer at The Week, primarily contributing to Speed Reads.
- 
 ‘The worry is far from fanciful’ ‘The worry is far from fanciful’Instant Opinion Opinion, comment and editorials of the day 
- 
 How are Americans bracing for the end of SNAP? How are Americans bracing for the end of SNAP?TODAY'S BIG QUESTION Millions depend on supplemental federal food funds that are set to expire this month, as the government shutdown begins to be acutely felt 
- 
 Book review: ‘Joyride: A Memoir’ Book review: ‘Joyride: A Memoir’Feature A journalist’s story of how she chased and accomplished her dreams 
- 
 What is a bubble? Understanding the financial term. What is a bubble? Understanding the financial term.the explainer An AI bubble burst could be looming 
- 
 Common signs of a romance scam and what one could cost you Common signs of a romance scam and what one could cost youthe explainer Don’t let love cloud your judgment 
- 
 Is it a good investment to buy a house? Is it a good investment to buy a house?The Explainer Less young people are buying homes, opting to rent and invest in the stock market instead 
- 
 5 side hustle ideas to supplement your budget 5 side hustle ideas to supplement your budgetthe explainer Almost two-thirds of Americans are looking to get a second job in the next year 
- 
 How to determine the right car for your needs How to determine the right car for your needsthe explainer Assess your budget, driving habits and fuel costs 
- 
 The pros and cons of having more than one credit card The pros and cons of having more than one credit cardPros and Cons Having more than one card can offer financial benefits — but be careful of overspending 
- 
 How to save on tickets to concerts and other events How to save on tickets to concerts and other eventsThe Explainer See your favorite artist without breaking the bank 
- 
 What is day trading and how risky is it? What is day trading and how risky is it?the explainer It may be exciting, but the odds are long and the risks high 
