House Republicans are looking to reshape college students’ federal loans as part of the GOP’s reconciliation legislation.
House Education and Workforce Committee Republicans released their plans, which could make borrowing money for college more expensive by limiting who can get Pell Grants, restricting access to college financial aid, and lowering loan limits for parents and some students.
The changes are part of an effort to cut spending to pay for President Donald Trump’s proposed tax cuts and increased defense and border security spending. Republicans are looking to cut $1.5 trillion, with Rep. Tim Walberg (R-MI), Education Committee chairman, tasked with finding $330 billion in savings. Changes to student loans are estimated to cut over $185 billion over a decade, according to the Congressional Budget Office.
The 103-page legislation released this week notably curbs access to Pell Grants, the largest federal program that delivers vital financial aid to middle- and lower-income households to fund college education.
The legislation would change the credit eligibility requirements for Pell Grants to 30 credit hours per academic year, an average of 15 credit hours per semester. Students are eligible for the grant if they are enrolled in 12 hours per semester. Most universities consider 12-18 credit hours per semester to be full-time.
The increase to 15 credit hours per semester would affect about a quarter of Pell Grant recipients, according to an analysis by the National College Attainment Network.
“While we support initiatives to reduce the time it takes for students to attain a degree, this approach may jeopardize time to completion for students who work part time,” said Kim Cook, chief executive of the National College Attainment Network. “By increasing students’ unmet financial need, this proposal will also drive up student borrowing for millions.”
Students taking fewer than six credit hours would no longer receive a grant, meaning students who need just one remaining class to graduate could not use a Pell Grant to cover the cost.
The legislation would also end the PLUS Loan program for graduate students, which allows them to borrow up to the full cost of attending a university. Under the bill, students pursuing a master’s degree could borrow no more than $100,000, and students pursuing an M.D. or juris doctor could not borrow more than $150,000.
The legislation would also eliminate subsidized loans that require the United States to pay for undergraduate students’ interest while they are in school. To mitigate the effects on college students, Republicans included a three-year exemption for students enrolled as of June 30, 2026.
The bill would additionally increase the aggregate borrowing limit for undergraduate students still claimed as dependents from $31,000 to $50,000. It would also change the annual borrowing limits so that they are based on the median cost of a student’s academic program, which means students in different majors could have different loan limits.
Finally, students would only be given two loan repayment options instead of the current four.
The two GOP-led options would be one standard 10-year plan or one income-driven repayment plan. This would combine the four current IDR plans into one, effectively ending former President Joe Biden’s Saving on a Valuable Education plan, which is being litigated in court.
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The new standard plan would have a tiered structure: those with an outstanding principal of less than $25,000 would repay the debt for no more than 10 years, those with $25,000 to $50,000 outstanding principal would repay for no more than 15 years, those with $50,000 to $100,000 outstanding principal would repay for no more than 20 years, and those with $100,000 outstanding principal would repay for no more than 30 years.
The House bill could face hiccups in the GOP-controlled Senate.