Approximately one in six American adults hold federal student loan debt, adding up to a grand total of over $1.6 trillion as of early 2025. While mounting college costs have community colleges considering alternative pathways they can offer to prospective students, there are many changes on the horizon for the federal student loan landscape that will further impact the affordability and accessibility of a college education in the United States.
Here’s what you should know about the changes coming this summer.
New guidelines for borrowers
The “One Big Beautiful Bill Act,” signed into law last year, includes changes to federal student loan offerings, such as new funding caps and changes to loan repayment options. These changes primarily go into effect on July 1, 2026 and include: new yearly and lifetime caps on Parent PLUS loans; new guidelines to determine part-time students’ funding proportionally to course load; introduction of the Repayment Assistance Program (RAP), which will eventually replace current income-driven repayment plans like SAVE and IBR; Grad PLUS loans discontinued for new borrowers; and new annual and lifetime limits on Direct Unsubsidized Loans for graduate and professional programs for new borrowers.
Currently, graduate students can borrow up to the cost of attendance in federal student loans. The Education Department (ED) stated this policy has “led institutions to offer expensive graduate programs with a negative return on investment.” The changes are intended to provide “guardrails on future student loan borrowing and simplify the federal student loan repayment system,” though it’s unclear when or how the changes will impact college costs.
Since graduate programs and professional programs will soon have different loan limits, there is also a big question of what will be considered “professional” and how this may impact certain fields excluded from the distinction, such as nursing and social work.
Changing qualifications
More changes related to student loans have been proposed separately from the “One Big Beautiful Bill” – perhaps most notably, adjustments to who can qualify for the Public Service Loan Forgiveness (PSLF) program. In the ED’s final rule released in October, it “amends the definition of ‘qualifying employer’ to exclude organizations that engage in unlawful activities such that they have a substantial illegal purpose…”
Lawsuits have since been filed by states, cities, labor unions and nonprofits concerned that the new language is too vague and will allow the PSLF program to be used as “a political weapon.” Undersecretary of Education Nicholas Kent said that the rule will be carried out “neutrally, without consideration of the employer’s mission, ideology, or the population they serve.”
As of the end of December, there was a backlog of over 80,000 applications for the PSLF Buyback program and more than 700,000 applications for income-driven repayment plans. The backlog is only expected to grow – possibly by 10-fold – as millions of borrowers may be required to switch out of the Biden-era SAVE plan this year.
Disparate impacts
Changes in federal student loans will impact different groups in different ways. This is something journalists can dig deeper into. For example, lower-income borrowers may face higher payments when RAP replaces other income-driven repayment plans – Investopedia calculated that “the average lower-income single borrower would pay 734% more on RAP than IBR.”
These changes could also have a greater impact on Black Americans who, on average, take out higher amounts in federal loans compared to their peers to fund both associate’s and bachelor’s degrees. This group is also most likely to have the highest monthly payments and indicate they would use loan forgiveness programs for their student debt.
Currently “more than 1 in 4 federal student loan borrowers” are either delinquent on their loans or in default. Even though the ED has delayed wage garnishing for now, the uncertainties ahead have many borrowers concerned. Journalists have a unique opportunity to help their readers understand this changing landscape as more updates come, interpret the possible impacts, and point the way to useful resources.
