"Student loan borrowers can no longer apply for income-driven repayment plans after the Trump administration paused applications—the Education Department’s first substantial action on student loans under the new president. But it’s unclear whether the pause is a temporary response to court orders or part of a broader Republican plan to remake the student loan system, financial aid experts say," Inside Higher Ed reports.

..."Borrowers, they say, would likely see higher monthly payments. For instance, about four million borrowers are eligible for zero-dollar payments under the enjoined SAVE plan. The department would have to make significant operational changes to transfer loans from one repayment plan to another.

'A lot depends on how long the application is down for,' said Karen McCarthy, vice president of public policy at the National Association of Student Financial Aid Administrators. 'But the whole purpose of the income-driven repayment plans is to help struggling borrowers stay in a satisfactory repayment status … so to not have any of those income-driven repayment plans available would definitely remove that large safety net.'"

NASFAA's "Notable Headlines" section highlights media coverage of financial aid to help members stay up to date with the latest news. Articles included under the notable headlines section are not written by NASFAA, but rather by external sources. Inclusion in Today's News does not imply endorsement of the material or guarantee the accuracy of information presented.

Publication Date: 2/26/2025