Trump’s New Student Loan Plan
President Donald Trump has unveiled a historic education overhaul under his One Big Beautiful Bill Act, marking the most significant reform of the federal student loan system in decades.
Under Trump’s leadership, the Department of Education has ended the wasteful Grad PLUS program, placed new caps on Parent PLUS loans, and simplified repayment into a single, common-sense Repayment Assistance Plan.
Fixing America’s Broken Student Loan System
More than 42 million Americans owe a staggering $1.7 trillion in student debt — a burden that has crushed families and inflated college costs for years. President Trump’s reforms aim to restore affordability, accountability, and balance in higher education while protecting taxpayers.
Beginning July 2026, the new Repayment Assistance Plan will:
- Cap graduate student borrowing at $20,500 per year (up to $100,000 total).
- Limit professional students to $50,000 annually, with a $200,000 lifetime cap.
- Restrict Parent PLUS Loans to prevent colleges from taking advantage of working families.
Officials say the changes will end reckless borrowing, stop tuition inflation, and force universities to lower costs — something Washington elites ignored for decades.
Accountability Returns to Higher Education
The Trump administration is making it clear: colleges must deliver real value for every tuition dollar.
“These reforms will simplify repayment, lower long-term costs, and pressure universities to operate responsibly,” said Education Under Secretary Nicholas Kent.
The new rules also overhaul the Public Service Loan Forgiveness (PSLF) program. Employers engaged in illegal or extremist activities — such as providing aid to illegal immigrants or links to terrorist groups — will be barred from PSLF eligibility.
However, organizations can regain eligibility after 10 years or by taking corrective action, and borrowers won’t lose credit for past qualifying payments.
Liberal Cities Fight Back — But Trump Stands Firm
Predictably, Democrat-run cities like Boston and Chicago have joined major labor unions in suing the Trump administration, claiming the reforms are “harmful.”
But conservatives say this is just another example of the Left protecting broken bureaucracies instead of helping students and parents.
In 2022, Biden’s administration expanded loan forgiveness with no accountability — a move critics say encouraged reckless borrowing. President Trump’s new policy restores fairness and fiscal sanity, putting working Americans first.
Encouraging Smart Choices and Real Careers
Financial educator Alex Beene noted that these changes will push students toward practical, high-demand careers and away from expensive, low-return degrees.
“Students will finally think twice before borrowing six figures for degrees with little career payoff,” Beene explained.
By reducing waste, promoting responsibility, and holding universities accountable, President Trump’s education reform protects taxpayers and empowers future generations to pursue success without lifelong debt.
Bottom Line: Trump Delivers Real Reform for Working Americans
President Donald Trump’s student loan overhaul is more than a policy change — it’s a return to common sense. By cutting bureaucratic excess, capping reckless borrowing, and defending American taxpayers, Trump is once again putting families, workers, and students first.
