By Tim Guan
Under the Trump administration, plans to change federal student aid have been overhauled for the 2018-2019 school year. With House Republicans intent to reauthorize federal law overseeing institutes of higher education, proposals to subsidize student loan debt and financial aid are impending while new student financial policies are expanded and limited.
The PROSPER act, a 542 page-bill, devised by the Committee of Education and the Workforce aims to “To support students in completing an affordable postsecondary education that will prepare them to enter the workforce with the skills they need for lifelong success.” This bill covers topics ranging from campus free speech and issues on handling sexual assault cases to — most importantly the Free Application for Federal Student Aid(FAFSA).
On the effect this has on college tuition, according to Time Money, “calls for reducing the number of federal loan types, capping the amount graduate students and parents can borrow, and changing the current suite of loan repayment options.”
For student loan repayment, the Trump administration has “proposed to eliminate five different income-based student loan repayment plans to just one option,” according to FastWeb. This plan would cap payments at 12.5 percent of a borrower’s income and then forgive the student loan balance after 15 years of responsibility payments.
However, for both parents and students, the act also implements a borrowing limit on “dependent and independent” students. In total, these students would be able to borrow about $8,000 more, for a limit of $39,000. For independent students (generally students older than 24), the limit would increase by about $2,750, to $60,250. Graduate students would also get borrowing caps, which would be set at $28,500 annually, for a total of $150,000. (One exception is for medical students, who would get a separate, higher limit.)
In accordance with changes that have been made to FAFSA, students will be required to report tax information from an earlier tax year in order to be eligible for financial aid.