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What are the new US student loan rules?
The US government has introduced legislation that caps federal student loan borrowing, especially affecting Parent PLUS and Grad PLUS programs. Interest that was paused during legal challenges will restart on August 1, and repayment options are now more limited, with some plans being eliminated or replaced by less generous alternatives.
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How do recent legal rulings impact student loan repayment?
Legal rulings have led to the restart of interest on federal student loans, ending the pause that was in place. Court injunctions and questions over the Biden administration's authority have influenced these decisions, which could mean higher monthly payments for borrowers and fewer flexible repayment options.
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Can I still switch my student loan plans?
Currently, borrowers have a narrow window to switch between available repayment plans. However, ongoing legal and legislative changes mean that options are limited, and some plans have been eliminated. It's important to stay informed and act quickly if you want to change your repayment strategy.
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Will my interest rates increase or decrease?
Interest rates on federal student loans are set to restart on August 1, which could lead to higher costs for some borrowers. The exact impact depends on your loan type and repayment plan, but overall, the resumption of interest may increase your total repayment amount.
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Are there any new protections for student loan borrowers?
Recent legislation has reduced some borrower protections by limiting repayment options and capping borrowing. While the government aimed to reduce rising tuition costs and federal debt, these changes mean fewer safety nets for borrowers, making it more important to understand your options.
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What should I do if I’m worried about my student loans?
If you're concerned about how these changes affect you, consider reviewing your current repayment plan, exploring available options, and staying updated on legal rulings. Consulting with a financial advisor or student loan expert can also help you navigate the new landscape and find the best strategy for your situation.