Historic Student Aid Bill Includes Partial IBR Expansion
Yesterday the House of Representatives unveiled an historic student aid reform bill, which will be voted on this weekend in a package with health care reform, and a vote in the Senate will quickly follow. The bill will significantly increase need-based Pell Grants at no cost to taxpayers, with savings generated by streamlining the federal student loan programs.
The bill will also enhance Income-Based Repayment (IBR) for borrowers who take out their first federal loan after 2014, lowering the IBR payment cap to 10% of discretionary income and forgiving any remaining debt after 20 years for these borrowers. As long-time proponents of IBR, we're disappointed that the changes won't apply to current borrowers, as President Obama had proposed.
We strongly support the bill, which helps reduce students' need to borrow by increasing Pell grants and makes IBR even more helpful for future borrowers. We will continue working to improve student loan repayment options for all borrowers, and will keep you informed of new developments.
See our statement on the House bill.