The Trump administration is taking steps to shrink the Department of Education, which has significant implications for student loan borrowers. Federal courts have paused Biden-era programs aimed at easing repayment terms, including a reduction in forgiveness timelines and capping monthly payments at 5% of income. The removal of applications for these programs from the Department's website hampers borrowers' ability to adjust their terms. Additionally, those who fall behind payments risk severe impacts on their credit scores, potentially affecting future borrowing opportunities.
"If you're going to buy a car or get an apartment or a mortgage or another credit card, you will see your credit score drop precipitously," Jack Wallace told ABC13.
Now, the Department of Education has removed applications for these plans from its website, effectively locking borrowers out from adjusting their plans if they can't pay the standard rate.
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