NASFAA Statement on the Responsible Education Assistance Through Loan (REAL) Reforms Act

The bill would make significant changes to the student loan system and create a short-term Pell Grant program. 

Contact: Allie Arcese
Director of Communications
(202) 785-6954
[email protected]

WASHINGTON, D.C., AUGUST 4, 2022 — On Thursday, House Republicans introduced a loan reform proposal — the Responsible Education Assistance Through Loan (REAL) Reforms Act — that would, among other things, place caps on the overall amount any borrower would repay on their loans, make a number of adjustments to income-driven repayment (IDR) plans that would offer more targeted relief to borrowers, and give schools the authority to limit loans for populations of borrowers in certain circumstances. The bill would also create a short-term Pell Grant program, allowing eligible students to access Pell Grants for programs as short as 150 clock hours. Alarmingly, the bill would also eliminate the Public Service Loan (PSLF) program and dramatically decrease the amount of federal loans available to graduate students.

NASFAA President Justin Draeger issued the following statement:

"NASFAA has held firm in the belief that widespread loan forgiveness of any kind should also come with comprehensive reforms to the student loan system to prevent borrowers and taxpayers from ending up in the same position in the future. We’re pleased to see thoughtful proposals included in this legislation that would provide targeted support for struggling borrowers, as well as much needed changes to the way the student loan repayment system operates, through streamlined repayment plans, caps on the overall amount borrowers repay, and granting schools the authority to curtail excessive borrowing in limited circumstances. 

We are, however, alarmed by the proposal to eliminate the Public Service Loan Forgiveness program, which encourages students to pursue careers for the betterment of our country. While program reform is needed, NASFAA supports PSLF reforms that preserve the intent of the program and ensure its promises can be easily delivered to student borrowers. What’s more, eliminating the Grad PLUS program — creating a net effect of lower overall annual and lifetime limits on borrowing for graduate and professional students — would significantly and negatively impact graduate and professional students. 

As with any federal student aid changes, we will be examining closely whether any proposed programmatic changes result in budgetary savings, and urge lawmakers to ensure any savings are reinvested back into the student aid programs, through Pell Grant increases or other borrower benefits that lower the overall cost of student loans. 

We look forward to working with congressional members on proposals to reform our federal student loan system."


The National Association of Student Financial Aid Administrators (NASFAA) is a nonprofit membership organization that represents more than 32,000 financial aid professionals at approximately 3,000 colleges, universities, and career schools across the country. NASFAA member institutions serve nine out of every 10 undergraduates in the U.S. Based in Washington, DC, NASFAA is the only national association with a primary focus on student aid legislation, regulatory analysis, and training for financial aid administrators.

Publication Date: 8/4/2022

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