Republican lawmakers have proposed major changes to student loans, which would affect current and future borrowers. Liudmila Chernetska/Getty Images/CNET
Republicans in Congress are moving closer to overhauling the federal student loan system with budget legislation that, following US President Donald Trump's lead, they call "One Big Beautiful Bill." House Republicans passed their version of the bill in May, and the GOP-majority Senate's Committee on Health, Education, Labor and Pensions released its legislative proposals for the bill on June 10.
Both versions include major changes to student loans, among them a paring down of current repayment plans to just two options, both with longer repayment periods.
Experts warned that the longer time frames for the new repayment plans could burden borrowers with education debt for much longer than expected.
"I worry that we will be increasing the population of the elderly still holding student debt," said Betsy Mayotte, president and founder of the Institute of Student Loan Advisors. "Longer debt can impact things like home purchase, the cost of other credit and, of course, retirement."
Existing borrowers may retain access to the Income-Based Repayment plan, but anyone who borrows after July 2026 would be subject to the new rules. Millions of SAVE borrowers could be forced onto the new plans when the administrative forbearance period ends.
Nothing has been finalized yet, but if the bill does pass, here's how it could affect your student loans and long-term finances.
Read more: If You're a Student Loan Borrower Enrolled in Save, Make This Move Now While Your Payments Remain Paused
What are the Republicans' new student loan repayment plans?
While there are some differences between the House and Senate proposals for overhauling student loans, both plans outline two new repayment plans: a standard repayment plan and the Repayment Assistance Plan.
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