Sponsors (22)
The bill expands access to income‑driven repayment for Parent PLUS and related consolidation borrowers—providing immediate, meaningful monthly payment relief for many parents and low‑income families—while increasing federal costs and adding administrative burdens that could raise taxpayer exposure and implementation risks.
Parents and guardians who borrowed Parent PLUS (and borrowers who consolidated PLUS/428B loans) can enroll in income‑driven repayment (ICR/IBR), reducing monthly payments and lowering default risk for many family borrowers.
Low‑income borrowers (including low‑income parents/students) will have their payments capped at no more than 15% of discretionary income, meaning substantially lower monthly burdens for the poorest borrowers.
Eligible Parent PLUS and 428B consolidation borrowers can access these repayment changes immediately at enactment, so relief begins without long delay for eligible borrowers.
Taxpayers may face higher federal costs because extending income‑driven eligibility to Parent PLUS and consolidation borrowers increases loan subsidy/forgiveness exposure and can lower near‑term repayments to the government.
Some borrowers—particularly those with higher or rising incomes—may end up repaying over a longer period and paying more interest over their lifetimes compared with staying on standard 10‑year plans.
The Department of Education and loan servicers will face increased administrative and implementation burdens (including an immediate effective date and annual recalculations), raising the risk of errors, delays, and borrower confusion during enrollment/recertification.
Based on analysis of 4 sections of legislative text.
Allows parents with Federal Direct PLUS loans for dependent students (and certain consolidations) to access ICR and IBR and sets IBR eligibility when 10-year standard payments exceed 15% of AGI minus 150% of the poverty guideline.
Introduced February 27, 2025 by Maxine Waters · Last progress February 27, 2025
Makes parents (and other borrowers who took Federal Direct PLUS loans on behalf of dependent students, and certain consolidation borrowers) eligible to enroll in income-contingent repayment (ICR) and income-based repayment (IBR) plans. It removes statutory exclusions that previously barred these PLUS-on-behalf borrowers from these income-driven plans, and it changes the IBR eligibility test so eligibility kicks in when the 10-year standard repayment amount exceeds 15% of a borrower (and spouse's) adjusted gross income after subtracting 150% of the poverty guideline for family size. The changes take effect on enactment and apply to qualifying borrowers who are repaying or will repay under ICR or IBR on or after that date.