PRIA Logo™
119-hr-7810119th CongressWALLET

Lowering Student Loans Act

Sponsored By: Representative Thompson, Mike [D-CA-4]

Introduced

Summary

This bill would set a uniform 2 percent interest rate on federal student loans first disbursed on or after July 1, 2026 and align many existing and consolidation loans to that rate. It would fix that rate for the life of affected loans and require notice and opt-out rights for borrowers before changes take effect.

Show full summary
  • New direct loan borrowers: Loans first disbursed on or after July 1, 2026 would carry a 2 percent fixed interest rate on the unpaid principal.
  • Existing borrowers: Direct loans with first disbursement before July 1, 2026 that have interest rates above 2 percent would be reset to 2 percent on July 1, 2026, with at least 90 days' written notice and a 90-day opt-out window.
  • Consolidation and FFEL borrowers plus servicers: Direct consolidation loans received on or after July 1, 2026 would receive the 2 percent rate and FFEL borrowers could consolidate into the Direct Loan program to obtain 2 percent. The Education Department must notify loan servicers at least 90 days before July 1, 2026 and establish a borrower complaint process for errors or delays related to the adjustments.

Personalized for You

How does this bill affect your finances?

Personalize government policy and PRIA will tell you what this bill means for your household, plus every other piece of legislation we track. PRIA reads each provision against your financial profile to show you exactly what matters to your wallet.

Free to download

Bill Overview

Analyzed Economic Effects

1 provisions identified: 1 benefits, 0 costs, 0 mixed.

2% interest for federal student loans

If enacted, this bill would set a fixed 2% interest rate for new Federal Direct loans first disbursed on or after July 1, 2026. Direct consolidation loans with applications received on or after July 1, 2026 would also get the 2% rate. For many existing Direct loans and qualifying existing Direct consolidation loans with rates above 2%, the rate would drop to 2% on July 1, 2026 unless you opt out after receiving notice. The Department would have to notify servicers and affected borrowers at least 90 days before July 1, 2026 and give borrowers 90 days after notice to opt out; borrowers with FFEL consolidation loans could consolidate into the Direct program after July 1, 2026 to obtain the 2% rate.

Sponsors & CoSponsors

Sponsor

Thompson, Mike [D-CA-4]

CA • D

Cosponsors

  • Del. Moylan, James C. [R-GU-At Large]

    GU • R

    Sponsored 3/4/2026

  • Del. Norton, Eleanor Holmes [D-DC-At Large]

    DC • D

    Sponsored 4/9/2026

Roll Call Votes

No roll call votes available for this bill.

View on Congress.gov
Back to Legislation