Federal RuleAug 21
62
DOL Rewrites Disability Rules for 'Merit-Based Opportunity' Push
RuleLabor DepartmentFederal Contract Compliance Programs OfficeSignificant Wallet
HR4862119th CongressWALLET
LOAN Act
Sponsored By: Representative Scott, Robert C. "Bobby" [D-VA-3]
Introduced
Summary
An overhaul of Pell Grants and federal student-loan rules. The LOAN Act would raise and fully fund Pell Grant maximums, expand who can get Pell, and replace many loan rules with two clear repayment tracks plus new refinancing options.
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- Students and families: Raises the Pell maximum from $10,000 in 2026–27 to $14,000 by 2031–32 and then ties future increases to inflation. It also restores Pell eligibility to 18 semesters and adds rules that let students with negative Student Aid Indexes get extra aid.
- Borrowers: Ends origination fees for new loans and creates two repayment pathways — a Fixed Plan and an Income-Driven Repayment (IDR) plan. The IDR plan can lead to forgiveness after about 20 years for non‑graduate loans and about 25 years for graduate loans.
- Public service and defaulted borrowers: Streamlines Public Service Loan Forgiveness to 96 qualifying payments, builds an online PSLF portal and jobs database, and creates a rehabilitation pathway with affordable monthly payments and credit-report removal after successful rehab.
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Bill Overview
Analyzed Economic Effects
8 provisions identified: 2 benefits, 0 costs, 6 mixed.
Default, fraud, and rehabilitation rules
If enacted, the Secretary could accelerate and collect the entire unpaid balance when a borrower defaults and use standard collection tools like wage garnishment and IRS offsets. The Secretary could also demand repayment within 30 days if the borrower was found ineligible for a loan because of fraud, and consolidation of such ineligible loans could be barred. At the same time, a new rehabilitation program would let a defaulted borrower restore good standing by making 9 affordable payments in 10 months, suspend garnishment after five qualifying payments, and require removal of default-related items from credit reports after rehabilitation.
More Pell, grants, and student aid rules
If enacted, the maximum Pell Grant would rise on a schedule: $10,000 for 2026–2027; $11,000 for 2027–2028; $12,000 for 2028–2029; $13,000 for 2029–2030; and $14,000 for 2030–2031. From 2031–2032 on, the maximum would be $14,000 plus the annual CPI increase, rounded to the nearest $50. The bill would also let some postbaccalaureate students use Pell, extend subsidized Stafford loan eligibility to some graduate students starting July 1, 2026, set minimum scholarship or support amounts tied to 10% of the Pell maximum, change satisfactory academic progress rules (including limited resets and warnings), and lower one institutional Pell-share number from 10% to 5%.
New repayment and IDR rules
If enacted, loans made on or after July 1, 2026 would use one of two plans: a fixed plan or a new income-driven plan. The bill would set fixed-plan terms (10 years standard; longer tiered terms for some consolidations) and a $50 minimum monthly payment. The new income-driven plan would base payments on income above 225% of the poverty line, let very low incomes pay $0, and automatically cancel remaining balance after certain payment counts (for example, 240 payments over at least 20 years or other schedules). The Department would build a borrower portal, may auto-enroll some delinquent borrowers into IDR, and the law would change which loans are treated as "covered loans" for recertification and counting rules.
Restore prior higher education law
If enacted, the bill would repeal Subtitles A through F of Public Law 119-21 and restore the prior Higher Education Act text as if those subtitles had never been enacted. This would reverse many recent statutory changes to the Higher Education Act and could affect students, borrowers, and institutions in multiple ways.
Lower rates, no fees, and interest rules
If enacted, loans first disbursed on or after July 1, 2026 would get a fixed annual rate set each year no higher than 5.0%. The bill would replace the prior 4% origination fee with 0% for loans disbursed on or after July 1, 2026. It would ban capitalization of interest in many cases and require lenders to contact borrowers at least every 180 days during forbearance with clear statements about unpaid principal and interest. The bill would also let you make extra payments without penalty and set rules for how extra payments apply.
Public Service Loan Forgiveness changes
If enacted, PSLF would require 96 qualifying monthly payments made after October 1, 2007 while you worked in public service to get forgiveness. The bill clarifies which payments, deferments, and forbearances count toward PSLF and how prepayments apply. It would allow work as an independent contractor to count and sets a numeric 30-hour-per-week full-time test, with special rules for some college teachers.
Federal student loan refinancing option
If enacted, the Department would run a federal refinancing program for eligible loans disbursed before July 1, 2026. The new refinanced loan would equal unpaid principal plus accrued unpaid interest and late charges, carry a fixed rate (subject to the cap), and exclude capitalized interest and fees from the base that accrues new interest. Some refinanced loans would lose eligibility for certain repayment and forgiveness programs, and refinancing would not automatically extend your repayment term.
Private student loan reporting rules
If enacted, private student loan lenders would have to report aggregate data to federal agencies. Reports would show total private loan debt held, number of borrowers, average interest rate, and delinquency and default proportions (30/60/90 days and in default). The data would be used by the Department, Treasury, the CFPB, and Congress to monitor the private student loan market.
Sponsors & CoSponsors
Sponsor
Scott, Robert C. "Bobby" [D-VA-3]
VA • D
Cosponsors
Rep. Castro, Joaquin [D-TX-20]
TX • D
Sponsored 9/8/2025
Rep. Subramanyam, Suhas [D-VA-10]
VA • D
Sponsored 8/1/2025
Rep. Underwood, Lauren [D-IL-14]
IL • D
Sponsored 8/1/2025
Rep. Moore, Gwen [D-WI-4]
WI • D
Sponsored 8/1/2025
Rep. Thanedar, Shri [D-MI-13]
MI • D
Sponsored 8/1/2025
Rep. McClellan, Jennifer L. [D-VA-4]
VA • D
Sponsored 8/26/2025
Rep. Carson, André [D-IN-7]
IN • D
Sponsored 8/26/2025
Rep. Davis, Danny K. [D-IL-7]
IL • D
Sponsored 9/8/2025
Rep. Ansari, Yassamin [D-AZ-3]
AZ • D
Sponsored 9/8/2025
Rep. Fields, Cleo [D-LA-6]
LA • D
Sponsored 9/8/2025
Rep. Garamendi, John [D-CA-8]
CA • D
Sponsored 9/8/2025
Rep. Bonamici, Suzanne [D-OR-1]
OR • D
Sponsored 9/8/2025
Rep. Williams, Nikema [D-GA-5]
GA • D
Sponsored 9/8/2025
Rep. Wilson, Frederica S. [D-FL-24]
FL • D
Sponsored 9/8/2025
Del. Norton, Eleanor Holmes [D-DC-At Large]
DC • D
Sponsored 9/8/2025
Rep. Tonko, Paul [D-NY-20]
NY • D
Sponsored 9/8/2025
Rep. Kennedy, Timothy M. [D-NY-26]
NY • D
Sponsored 9/9/2025
Rep. Evans, Dwight [D-PA-3]
PA • D
Sponsored 9/11/2025
Rep. Chu, Judy [D-CA-28]
CA • D
Sponsored 11/18/2025
Rep. Walkinshaw, James R. [D-VA-11]
VA • D
Sponsored 11/20/2025
Rep. Grijalva, Adelita S. [D-AZ-7]
AZ • D
Sponsored 11/20/2025
Rep. Adams, Alma S. [D-NC-12]
NC • D
Sponsored 12/3/2025
Rep. Green, Al [D-TX-9]
TX • D
Sponsored 2/24/2026
Rep. Simon, Lateefah [D-CA-12]
CA • D
Sponsored 4/28/2026
Rep. Lynch, Stephen F. [D-MA-8]
MA • D
Sponsored 6/3/2026
Rep. DeSaulnier, Mark [D-CA-10]
CA • D
Sponsored 6/29/2026
Rep. Figures, Shomari [D-AL-2]
AL • D
Sponsored 7/20/2026
Roll Call Votes
No roll call votes available for this bill.
View on Congress.gov