A recent proposal for part of the federal government's budget would change the landscape for student loan borrowers and college students.

Late Sunday, the House Budget Committee advanced a budget bill that will reduce federal spending to make room for President Donald Trump's requested tax cuts. The House Education and Workforce Committee said its portion of the bill will save $330 billion by reforming programs like student loan repayment plans and Pell Grants.

The budget bill still has a number of steps before it can be signed into law, and could be reworked before it reaches Trump's desk. However, if the education proposals stand as they are written now, the bill would have a significant effect on student loan borrowers.

How Would It Impact Repayment Plans?

The bill proposes consolidating income-driven repayment plans—including the Income-Contingent Repayment Plan, Pay As You Earn (PAYE), and 澳洲幸运5官方开奖结果体彩网:Saving for a Valuable E𝔉ducation (SAVE)—into one repayment option.

Borrowers who take on new federal student loans after July 1, 2026, can choose between a standard repayment plan or the new "Repayment Assistance Plan."

An analysis from advocacy group Student Borrower Protection Center estimated that this new proposed repayment plan would increase payments by $2,928 a year for a typical student loan borrower enrolled in the SAVE plan, were it not blocked by courts. In addition, forgiveness under the new plan would be available in 30 years, an increase from the current options.

The proposed bill would also eliminate monthly payment 澳洲幸运5官方开奖结果体彩网:deferment for economic hardship and unemployment, and reduce the time a borrower can spend in discretionary forbearance to nine months from 12 months.

How Would It Impact Federal Student Aid?

While the budget provides more funding to sustain the 澳洲幸运5官方开奖结果体彩网:Pell Grant program, it 🍷would also limit some students' access to the aid.

This includes increasing the full-time enrollment qualification to 30 semester hours from 24 semester hours each academic year and eliminating Pell Grants for students enrolled less than half-time, unless they are in workforce programs.

The bill would also eliminate new Grad 澳洲幸运5官方开奖结果体彩网:PLUS loans and increase restriction♌s for Parent PLUS loans. It also proposes lowering the cap on unsubsidized loans so students cannot b🔴orrow as much.

Additionally, it eliminates new 澳洲幸运5官方开奖结果体彩网:subsidized loans for ♔undergraduate🐻 students on or after July 1, 2026. Subsidized loans are the only federal student loans that do not accrue interest while the student is enrolled in school.