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Millions of federal student loan borrowers may soon face higher monthly payments and less payment protection.
the Department of Education Propose comprehensive changes to the framework Reimagine and improve student learningor RISE, the rule. If completed, the changes will be cancelled Graduate loans are a plusrestricts Parent PLUS payment optionsTightening postponement rules.
Parent borrowers could lose access to income-driven repayment as early as July. Graduate students will face strict borrowing limits starting in 2026. Borrowers enroll in the program Save The plan may need to switch payment programs over the next year.
For families with student debt, this is not theoretical; Becca Craig, Wealth Advisor at Focus Financial Wealthhe said in an interview. It affects what you can borrow, what you have to repay, and how flexible your loan is during financial hardship.
Below is a transcript of that interview, edited for clarity and brevity.
The proposed federal student loan changes are not something you should ignore
Robert Powell: The Department of Education recently released proposed rules that could significantly impact federal student loans. Borrowers should not ignore them.
Here to explain what might change, why it’s important, and what practical steps borrowers should consider is Becca Craig, a wealth advisor at Focus Partners Wealth. Becca, hello.
Becca Craig: Thank you so much for having me, Bob. I’m happy to be here.
What is the RISE proposal?
Robert Powell: Before we get into the details, can you set the schedule? These proposed rules are related to the so-called RISE Act or RISE Rules.
Becca Craig: Yes. There’s always a lot going on when it comes to student loans, but what borrowers — current and future — should pay attention to now is the proposed RISE rule, which stands for Reimagining and Improving Student Education.
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It has undergone committee review and is now open for public comment. Once that window closes, we will see the final regulations. For now, this proposal is a measure of the direction the Department of Education is headed.
It gives borrowers a chance to plan for the future – whether they are repaying loans now or considering new loans for themselves or their dependents.
Parent PLUS loans and income-based repayment
Robert Powell: One major change involves Parent PLUS loans. What’s going on there?
Becca Craig: The proposed rule runs nearly 100 pages. But one of the most important provisions affects existing borrowers of federal Parent PLUS loans.
Parent PLUS loans are taken out by a parent on behalf of a dependent. Historically, these loans have had higher interest rates and less convenient repayment options.
Under this proposal, Parent PLUS borrowers would no longer be eligible for income-based repayment plans.
This is a very big deal.
For many borrowers, especially retirees on fixed incomes, losing the ability to access income-driven repayment could mean doubling or even tripling their monthly payments. Without IDR, they would fall behind on the standard repayment plan.
Borrowers who consolidate their Parent PLUS loans into a Direct Consolidation Loan before the effective date can maintain access to income-driven repayment options. Consolidation usually takes four to six weeks.
Robert Powell: And this is still a federal loan and not a private refinancing?
Becca Craig: correct. Consolidation is completely separate from refinancing. Refinancing moves the federal loan to the private market. Consolidation keeps the loan within the federal system.
Graduate PLUS loans have been canceled for new borrowers
Robert Powell: What about Graduate Loans PLUS?
Becca Craig: The proposal would eliminate Graduate PLUS loans for new borrowers starting July 1, 2026.
Instead, borrowing will be limited by… Direct Loan Program With strict annual and lifetime limits.
Graduate students will face an annual limit of $20,500 and a lifetime maximum of $100,000. Professional students – such as students in medical or law programs – will face an annual limit of $50,000 and a lifetime maximum of $200,000.
Graduate and professional programs can be very expensive. Historically, the Graduate PLUS program has covered the full cost of attendance above and beyond other aid.
Without it, many borrowers may need to turn to private loans, employer support, family assistance or less expensive program options.
A new definition of “professional student”
The proposal also provides a narrower definition of the term “professional student,” limiting the higher borrowing caps to 11 specific professional degree programs.
If a program is not classified as a professional program under the new definition, students may have lower borrowing limits.
This designation could significantly impact the amount of federal funding available — and whether private loans will become necessary.
Undo the save plan
Robert Powell: Many borrowers enrolled in a SAVE plan wonder what happens next.
Becca Craig: This is the question everyone asks.
SAVE is designed as a more generous income-driven repayment plan with lower payments and interest support. However, it has faced legal challenges and is now being rolled back.
Borrowers currently in SAVE will need to choose another repayment plan.
Options that are still available include:
- Income Based Repayment (IBR)
- Income Conditional Repayment (ICR)
- Pay as you earn (PAYE)although it is gradually being eliminated
There is also discussion about the future Rap planbut borrowers cannot choose that yet.
My advice: log in StudentAid.govReview your loans and use repayment calculators. Compare your options now instead of waiting for potential backlogs or service delays.
Safety nets may be tightened
Robert Powell: The proposal also affects deferral and forbearance options. What should borrowers know?
Becca Craig: For loans disbursed on or after July 1, 2027, the suggestion will be removed Unemployment Postponing economic difficulties. It will also set nine-month grace periods within a 24-month period.
This is important because loan planning is not just about when everything goes well. It’s about to LayoffsIllness, caregiving, and business slowdowns – real-life events.
Borrowers may also end up splitting eligibility if they have loans from different terms.
Planning is essential
Robert Powell: What’s the point?
Becca Craig: Borrowers need to look at their complete financial picture.
Build or boost your emergency savings. Understand your payment options. If necessary, work with a financial professional who understands student loan planning.
This proposal shifts more responsibility to families and borrowers for financing and planning higher education. This means evaluating the value of the degree, program costs, and long-term reimbursement implications.
There are also certified student loan professionals who specialize in integrating repayment planning into a broader financial plan.
You don’t have to navigate this alone.
