Federal Student Loan FAQs and Info
Starting July 1, 2026: Changes to Federal Student Loans
On July 1, 2026, changes to federal student loan borrowing and repayment for current and future borrowers will take effect. This is a direct result of President Trump’s disastrous One Big Ugly Bill and his administration’s ongoing attacks on public education. This will impact roughly 9,000 borrowers enrolled in the SAVE plan, and over 88,000 student loan borrowers in California’s 12th Congressional District.
Q: Why is the Department of Education eliminating the SAVE plan?
- The Department has announced that loan servicers will begin sending notices to borrowers enrolled in SAVE on or around July 1, 2026, telling them to enroll in a different repayment plan within 90 days. This means you will probably need to switch plans by the end of September 2026.
- If you do not enroll in a different repayment plan by the end of your 90-day grace period, the Department has said you will be automatically reassigned to another plan, likely the Standard Repayment Plan. Payments in the Standard Repayment Plan are based on the borrower’s loan balance, not their income, and are often much higher than payments in SAVE or other income-driven repayment plans.
Q: What changes will be made to Federal Student Loans?
- The implementation of new lending limits will go into effect July 1st, 2026, reducing how much new students and parents can borrow:
- Students enrolled in graduate level programs will be eligible for $20,500 per year ($100,000 lifetime). Note: these lending limits are subject to ongoing litigation.
- Students enrolled in professional level programs will be eligible for $50,000 per year ($200,000 lifetime).
- Parent PLUS loan borrowers will be eligible for $20,000 per year ($65,000 lifetime) per student. Note: Parents PLUS borrowers whose child is completing a program that began prior to July 1 are grandfathered into the prior Parent PLUS program until the student completes the program or until July 1, 2029.
- Students will now face a new lifetime borrowing limit of $257,500 (excluding Parent PLUS loans, but including all other loans taken out before July 1, 2026).
To understand how these loan changes impact you, my office recommends the following resources:
- Visit the federal Department of Education’s Federal Student Aid website for details on the student loan changes that go into effect on July 1, 2026, and calculate your federal student loan repayment options.
- Connect with student loan repayment counseling resources provided by the California Department of Financial Protection and Innovation (DFPI).
- Check with your student loan servicer to determine how these changes impact your specific loan repayment.
- If you have a complaint with your financial loan provider, submit a complaint to the Consumer Financial Protection Bureau: https://www.consumerfinance.gov/complaint/. Complaints are public and also accessible to the California State Attorney General.
Our team knows that these changes will heavily impact borrowers in CA’s 12th Congressional District. If you have any questions or concerns, please contact our District Office at (510) 763-0370.