Forty-three million Americans carry federal student loan debt totalling more than $1.7 trillion. On 3 November, many of them will walk into a polling booth whose outcome will determine whether Congress can begin to claw back some of what they lost.
The upcoming midterm elections are fast approaching, and the implications for student loans are significant. With control of Congress at stake in November, a change in party control of either the House or Senate, or both, could provide an opportunity for reforms, greater oversight, or even a rollback of at least some of the recent legislative changes that have upended several student loan programmes and are impacting millions of borrowers.
The One Big, Beautiful Bill Act, which Republican lawmakers and US President Donald Trump enacted last year, has completely changed federal student loans. The legislation terminates or phases out several popular income-driven repayment plans, blocks Parent PLUS borrowers from accessing affordable payment options and most forms of student loan forgiveness, and reimposes draconian federal taxation on income-driven repayment student loan discharges. No Democratic lawmaker in Congress supported the legislation.
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Meanwhile, the Education Department has trimmed its staff through mass layoffs and curtailed oversight of student loan servicers. Critics say these actions have led to major disruptions, system glitches and processing delays that are causing very real problems for borrowers.
What Did The One Big Beautiful Bill Actually Do To Student Loans?
Signed into law on 4 July 2025, the One Big Beautiful Bill Act introduces numerous changes that impact borrowers immediately and into the coming years. Several existing income-driven repayment plans, including SAVE, Pay As You Earn and Income-Contingent Repayment, sunset on or around 1 July 2026. Borrowers currently using these plans must transition to either the modified Income-Based Repayment plan or the newly introduced Repayment Assistance Plan.
Beginning on 1 July 2026, new student loan borrowers choose between one of two plans: a standard repayment plan or the new income-driven Repayment Assistance Plan. The Repayment Assistance Plan allows borrowers to pay between one and 10 per cent of their income on a monthly basis, for up to 30 years, Aissa Canchola Bañez, policy director at advocacy group Student Borrower Protection Centre, told CBS MoneyWatch.
The changes to the student loan repayment system will make loan repayment more expensive for borrowers, especially low and middle-income borrowers. The legislation ends zero dollar payments for the lowest-income borrowers who take out new loans and makes the minimum payment $10 even for borrowers with zero income. In August 2024, 14 per cent, or 4.5 million borrowers, had zero payments on an income-driven repayment plan.
As of 1 July 2026, deferment provisions for borrowers facing economic hardship are eliminated under the One Big Beautiful Bill Act. Currently, student loan borrowers can apply for up to three years of deferment based on economic hardship or unemployment.
The blow to Parent PLUS borrowers was particularly severe. New Parent PLUS loans are not eligible for the Repayment Assistance Plan or any other form of income-driven repayment after 1 July 2026. Parent PLUS loans lose all income-driven repayment eligibility on that date, and holders of existing loans could lose existing protections if they did not take action before the deadline.
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