Sponsor
Charles Roy
Representative · R-TX
Representative · R-TX
The bill increases program access and transparency while tightening loan availability and repayment options and imposing institutional accountability measures that reduce borrowing but raise costs, legal risks, and potential quality risks for students and institutions.
Students at state-authorized or state-accredited institutions and apprenticeship programs gain access to Title IV federal student aid, increasing program diversity and options for prospective students.
Students and policymakers get standardized program-level data on earnings, completion, and debt (with a GAO compilation/report), helping students make more informed enrollment/borrowing choices and enabling better oversight.
Federal changes (caps on annual and aggregate borrowing, ending certain high-balance loan types after 2030) plus institutional ability to award less than the maximum federal aid are likely to reduce how much many students borrow and lower lifetime loan exposure for future borrowers.
Prospective students after Sept 30, 2030 (and new borrowers after June 30, 2026) will face reduced access to some federal Direct Loans, which could make college less affordable or push costs onto private lenders and families.
Borrowers who take the new simplified loans are ineligible for income-contingent repayment and for loan forgiveness for loans made July 1, 2026 or later, removing key repayment flexibility and safety nets for many borrowers.
Caps on repayment terms (shorter maximum terms) and interest accrual from disbursement may raise monthly payments compared with longer or income-driven plans, increasing near-term financial strain for borrowers.
Based on analysis of 5 sections of legislative text.
Phases out most new Federal Direct loan originations after Sept. 30, 2030 (with a July 1, 2026 simplification-loan exception), creates state alternative accreditation for Title IV, mandates outcome disclosures, and imposes institutional fines.
Official title: To amend the Higher Education Act of 1965 to provide for fiscal accountability, to require institutions of higher education to publish information regarding student success, to provide for school accountability for student loans, and for other purposes.
Introduced February 27, 2025 by Charles Roy · Last progress February 27, 2025
Creates a major rewrite of several Title IV higher education rules: it phases out most new Federal Direct student loan disbursements after Sept. 30, 2030 (with a new “Federal Direct simplification loan” category that begins July 1, 2026, and is excepted), bars new borrowers after June 30, 2026 (except for simplification loans), and lets certain existing borrowers continue borrowing through 2030 only if they do not take a simplification loan. It also creates a state-based alternative accreditation pathway that expands what counts as an institution of higher education for Title IV, requires standardized program- and institution-level financial aid, completion, earnings, and loan outcome disclosures (with GAO reporting), and imposes new institutional fines tied to outstanding delinquent federal loans plus new counseling flexibilities and criminal penalties for misuse of published data.