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Trump's Education Department Unveils Controversial Loan Repayment Overhaul

1/12/2026

Summary

Story summary

U.S. President Donald Trump’s Education Department will replace existing income-driven repayment options with a new plan in July 2026.
The plan could simplify repayment for borrowers.
The Education Department will resume wage garnishments and tax refund seizures for defaulted loans.
Borrowing limits will be imposed on graduate and Parent PLUS loans.
Critics say the changes could hinder access for low-income students and weaken borrower protections under gainful employment rule revision.

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Story summary

U.S. President Donald Trump’s Education Department will replace existing income-driven repayment options with a new plan in July 2026.
The plan could simplify repayment for borrowers.
The Education Department will resume wage garnishments and tax refund seizures for defaulted loans.
Borrowing limits will be imposed on graduate and Parent PLUS loans.
Critics say the changes could hinder access for low-income students and weaken borrower protections under gainful employment rule revision.