Department of Education Implements New Student Loan Repayment Overhaul Affecting Borrowers
The Department of Education, under President Trump's administration, has announced a comprehensive overhaul of the student loan repayment system, set to take effect on July 1. This new rule introduces significant changes, including the elimination of the Grad PLUS program and the establishment of new borrowing caps for graduate and professional students. Specifically, a $100,000 lifetime cap for graduate students and a $200,000 cap for professional students have been set, with the definition of 'professional' narrowed to 11 programs such as law, medicine, and dentistry. This change excludes previously eligible programs like postgraduate nursing. Additionally, the department is capping Parent PLUS loans at $20,000 annually. A new Repayment Assistance Plan (RAP) will replace existing income-driven repayment plans, setting a minimum monthly payment of $10, which is less generous than current plans.