Trump Cuts Graduate Student Loans to $20,500 a Year, Tightening Federal Borrowing Limits
Updated
Updated · The American Prospect · May 27
Trump Cuts Graduate Student Loans to $20,500 a Year, Tightening Federal Borrowing Limits
6 articles · Updated · The American Prospect · May 27
June 1 changes to the Federal Direct Loan Program would scrap Direct PLUS loans for graduate and professional students and replace them with lower unsubsidized borrowing caps.
New limits set annual borrowing at $20,500 for graduate students and $50,000 for professional students, with lifetime caps of $100,000 and $200,000; Parent PLUS loans would be capped at $20,000 a year and $65,000 total per dependent student.
The Education Department is also requiring borrowers and families to shift repayment plans, a move the report says will typically raise their costs.
Less than 40% of federal student-loan borrowers are in active repayment and nearly 25% are already in default, underscoring stress in a system facing tighter credit.
Those caps land against college prices far above federal loan limits: average discounted annual costs are about $36,000 at private colleges and $16,000 for in-state public universities.
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