Summary
The Department of Education is starting discussions to change how student loan repayments work under President Trump's new plan. This involves replacing current repayment options with a new system called the Repayment Assistance Plan (RAP) that factors in the borrower's income.
Key Facts
- The Department of Education is holding sessions to discuss changes to student loan repayment plans.
- These changes are part of President Trump's "One Big Beautiful Bill."
- Current income-driven repayment plans will be replaced by a new plan called the Repayment Assistance Plan (RAP).
- RAP will set monthly payments from 1 to 10 percent of a borrower's annual income.
- Borrowers must enroll in RAP by July 1, 2026, or they will only have the standard repayment plan option.
- The standard repayment plan bases payments on loan amount and interest rates.
- Proposed changes will become part of federal regulations through a process called negotiated rulemaking.
