Twenty-five years ago, students across the country were encouraged to take out student loans in order to attend college, the cost of which had increased dramatically since the 1970s. It was played as an investment: You could safely borrow tens, even hundreds of thousands of dollars because a college degree was a path to a good-paying job, so you’d have no trouble paying back the loans you took out for education.
But even college graduates with salaried jobs struggled to pay back loans. Wages stayed depressed and the cost of housing, food, and child care increased, forcing many college graduates with loans to stretch their budgets further than previous generations. Student debt, however, ballooned. At the end 2024, more than 43 million borrowers owed a combined $1.6 trillion.
There have been many suggestions on how to handle the student debt crisis — and it appears the Trump administration has settled on making it even harder to go at all.
As part of the so-called “Big Beautiful Bill,” the budget signed into law by President Donald Trump on July 4, the administration has slashed the safety net and other public service programs. The bill makes deep cuts to Medicaid and the Supplemental Nutrition Assistance Program, putting millions of families in a financially precarious position. It gives tens of billions for immigration and border enforcement, cuts incentives for clean energy and more. In the deluge, one of the things that has slid under the radar is the way the bill revamps the federal student loan program, in a way that will make it harder to take out and pay off education debt.
“This bill will make paying for college more expensive and riskier,” Aissa Canchola Bañez, the policy director at the Student Borrower Protection Center, told HuffPost.
The bill changes student loans in three major ways: removing most of the existing income-driven repayment plans, making repayment more difficult for lower-income graduates; creating loan limits for graduate students and parent borrowers, which will make some higher-cost programs like medical school less accessible for people who can’t pay for them out of pocket; and denying federal funds to cover certain programs if their graduates don’t meet a certain income threshold.
In short, it will become harder to get loans to cover degrees that don’t quickly lead to higher-income jobs, like associate degrees, and fields that do lead to lucrative employment but have a high cost barrier to certification, like medicine. And it will become harder for everyone to pay loans off.
“It’s going to push folks out of college altogether because they won’t have access to a co-signer and they just won’t be able to pay,” Bañez said.
The changes to the federal student loan program also come at a time when Trump has openly feuded with elite institutions like Harvard University and Columbia University, demanding they adhere to his directive that schools end diversity programming and promote right-wing faculty or else risk losing federal funding. To a large extent, this assault has so far focused on the administration and leadership of schools: Trump has demanded changes to hiring and university governance, oversight of certain departments, disciplinary policies, and “audits” of the viewpoints of students and faculty.
Some schools have buckled under the demands, others have fought back. But the pressure has been placed on university leadership, even as the objective has been clearly to insert right-wing ideology into the patterns of elite higher education. It’s a brazen attempt to limit what universities can teach and what faculty at higher educational institutions can say. If he can control the information coming out of colleges, perhaps he can control what Americans say and think.
And now it appears the Trump administration wants de facto control over who even gets to go to these institutions and get access to this thinking in the first place.
“This just seems like the newest chapter out of those wider attacks on colleges,” Bañez added. “I think there are policymakers in Washington who believe that student loan borrowers deserve to be punished.”
Despite the Trump administration’s multipronged war on college, the real fight isn’t against going to college — after all, the right fought long and hard to end affirmative action, falsely believing their white children weren’t getting into fancy schools because they were being replaced by unqualified students of color. Instead, it’s about who should be able to go to college.
That’s why they’re pressuring Ivy Leagues to cut programs that don’t align with their right-wing worldviews, hire more conservative professors and limit international admissions to foreign students who haven’t criticized Trump or the United States.
And now they’re trying to make it so that college is limited to those who can afford it without help from the federal government.
“What does this mean for higher education? The people who come from means are going to be the only ones who go to college,” Bañez said.
Currently, there are several different ways to pay back your student loans, including plans that take the borrower’s income into account and the Saving on a Valuable Education plan. The SAVE plan, which was introduced by the Biden administration in 2022, has been tied up in court. When the legal fight ends, current borrowers will have to begin using the new plans after July 1, 2028. For everyone else, the new plan goes into effect on July 1, 2026.
But the new federal student loan system only has two available options for repayment plans, with the only payment plan considering a borrower’s income being the repayment assistance plan, known as RAP. But even though it’s based on income, it doesn’t take inflation into consideration, meaning your monthly payment could increase even as your wages stay the same.
People who will be forced to enroll in one of the two new plans in 2028 are also in for an unpleasant surprise.
“They will see a significant increase in their monthly payments,” Kristin Blagg, a researcher at the Urban Institute, told HuffPost. The Trump administration’s repayment plans are not as generous as the current ones, because they don’t take as many aspects into the borrower’s financial health into account. “People coming from SAVE are going to be shocked at what they have to pay now.”
Project 2025, the conservative blueprint for a Republican president, calls for the privatization of the student loan system. But private loans come with more risk.
“The loans are not as favorable, the interest rates are higher, particularly if you have low credit,” Blagg said. Oftentimes, low-income borrowers need a co-signer to access private loans.
The new system also takes into account the earnings of alumni of certain program graduates when assessing whether to give out loans to future students. If graduates of programs fail to reach a certain income, students will not be able to use federal loans to attend those schools and study with those programs.
Blagg says most programs should meet the income threshold — but the risk falls heavily on the lower end of the scale. “The places where we worry are associate degrees,” she said. These are two-year degrees earned at community colleges by high school graduates and other adults looking to advance their careers. Students hoping to get an associate degree may have to figure out another way to pay.
Then there are the limits for how much graduate students and parents can borrow for their dependent children. Most graduate students will now be limited to $20,500 per year, with a lifetime cap of $100,000 down from $138,500. For professional schools, like schools for doctors or lawyers that are often fairly expensive, the limit will be $50,000 per year, capped at $200,000.
Making medical school harder to access could not be coming at a worse time: The American Association of Medical Colleges projects that the U.S. will have a shortage of 86,000 physicians by 2036.
Even though the Trump administration has been trying to reward people for getting married and having kids, the new repayment assistance plan also penalizes married borrowers. The changes look at your household income. For example, a single person making $55,000 a year would only have to pay 5% of their income, but a married couple each making $55,000 would pay a 10% rate on their combined income of $110,000. (RAP does, however, include a discount for borrowers with children. A whopping $50 will be taken off your monthly payment for each child a borrower has.)
“Married borrowers are going to have to be very careful,” Blagg said.
It’s not clear if the Trump administration is making these changes because they believe it will benefit their voters. Republicans still think going to college is a good thing, and support ways to make it more affordable, including income-driven repayment plans for student borrowers.
According to a March 2025 poll from Third Way, a centrist advocacy organization, 79% of Republican respondents support payment plans that are affordable and make it harder to default on loans.
“It’s going to be a rude awakening for those who voted for something and are now getting something very different,” Bañez said.