What to Know About Crucial Changes to Student Loans

"Student loan advocates and borrower protection groups across the country have spent much of the last five months preparing for a series of big changes Congress laid out regarding the student loan system. From limiting the amount students and families can borrow to cutting the number of repayment plans they'll have to choose from, the One Big Beautiful Bill Act is one of the more significant overhauls to federal student aid in decades."

"That said, many of the details on how those changes will be put into effect are left up to the Education Department, which is currently working to draft new rules and regulations detailing what borrowers can expect. Many of those details were worked out over the last two months through a complicated process known as negotiated rule making, but the department still has a long way to go."

"The most contentious bit of the proposed suite of regulations concerned which graduate students get access to what amount of aid now that they've been cut off from coverage for the full cost of attendance. (You can read more about that here.) But the committee also dived into the nitty-gritty about how to grandfather in borrowers with certain types of loans or on certain payment plans that are going away and how to modify the loan rehabilitation process for borrowers trying to exit default."

Student loan advocates and borrower protection groups prepared for major changes after Congress enacted a broad overhaul to federal student aid. The overhaul limits borrowable amounts, reduces repayment plan choices, and creates new statutory repayment options. The Education Department must draft implementing regulations and used negotiated rule making to work through many details, but significant rulemaking steps remain. Regulations will undergo public review and response before finalization, with expected release in early 2026. Key regulatory debates included graduate student aid eligibility, grandfathering of borrowers and plans, and modifications to loan rehabilitation procedures. The legislation ends several income-driven plans and introduces a standard 10-25 year plan plus a new Repayment Assistance Plan.

Read at Inside Higher Ed | Higher Education News, Events and Jobs