New report on Trump's loan changes

The Center for American Progress released a report showing how President Donald Trump's student-loan repayment overhaul will affect millions of borrowers' bills and relief options.

What changed on July 1

Trump's student-loan changes, signed into law in his spending legislation, took effect July 1 and included new income-driven repayment plans and borrowing caps.

Average payment increases jump sharply

Borrowers moving from the Biden-era SAVE plan to the new Repayment Assistance Plan, or RAP, could see their student-loan bills increase by two thousand one hundred sixty-three dollars annually on average.

A typical borrower's payment doubles

A typical borrower with a bachelor's degree earning about sixty-eight thousand six hundred fifteen dollars annually would see monthly payments increase from one hundred thirty-six dollars to three hundred forty-three dollars.

SAVE allowed zero-dollar payments

The SAVE plan allowed for lower payments and a shorter timeline to debt relief, including zero-dollar monthly payments. RAP's minimum payment is ten dollars, eliminating that protection.

“Those $0 payments were a really important protection that many borrowers will struggle without.”

Parents face new borrowing limits

Parents who took out loans after July 1, 2026, face a lifetime borrowing cap of sixty-five thousand dollars and lose access to the income-contingent repayment plan.

Deferment option eliminated next year

The repayment overhaul eliminates all borrowers' ability to defer loan payments during economic hardship or unemployment beginning next year, raising default risk significantly.

“And without those options, borrowers may be more likely to become delinquent on their loans or eventually default, which we know can come with some devastating consequences.”