Student Loan Interest Elimination Act
Sponsored By: Representative Courtney, Joe [D-CT-2]
Introduced
Summary
Zero-interest federal student loans for many borrowers starting July 1, 2026. The bill would create an Education Affordability Trust Fund that uses Title IV loan repayments to fund loan administration, a Supplemental Pell top‑up, and a federal refinancing option that stops interest from accruing on modified or refinanced loans.
Your PRIA Score
Personalized for You
How does this bill affect your finances?
Sign up for a PRIA Policy Scan to see your personalized alignment score for this bill and every other piece of legislation we track. We analyze your financial profile against policy provisions to show you exactly what matters to your wallet.
Bill Overview
Analyzed Economic Effects
2 provisions identified: 1 benefits, 0 costs, 1 mixed.
New Education Affordability Trust Fund
If enacted, the bill would create an Education Affordability Trust Fund that receives all Title IV loan repayments without further appropriation. A six‑member presidentially appointed Board would manage investments under strict bond, credit‑quality, and diversification rules and meet special AUM triggers. The Board would transfer assets to the Department to pay Part D loan administrative costs based on 180‑day AUM thresholds: $500 million or more → 100% transfer; $400 million–$499,999,999 → 40%; $300 million–$399,999,999 → 10%; under $300 million → 0%. If transfers exceed administrative needs, the Secretary could use excess amounts for supplemental Pell Grants (awarded proportionally and not counted against Pell duration) and for competitive postsecondary grants of $600,000 to $1,000,000. The Secretary must report to Congress and testify within 180 days when excess funds are used.
Major student loan interest changes
If enacted, this bill would stop interest costs for many federal student loans. Interest would be set to 0% for new Direct Unsubsidized, PLUS, and Consolidation loans first disbursed or applied for on or after July 1, 2026. The Department would automatically modify many existing eligible Direct loans so interest stops on July 1, 2026, though you could opt out at any time. The Secretary could refinance eligible non‑Direct (private or guaranteed) loans into federal Consolidation Loans with no origination fee, no interest, and preserve prior qualifying payments with a weighted method; you could opt out of refinancing at any time. At the same time, the bill would end new subsidized Stafford loans after June 30, 2026 and raise the unsubsidized loan cap by the amount you would have received. Finally, for instruction periods starting on or after July 1, 2027, some annual and aggregate loan limits would be increased each year by changes in the Consumer Price Index.
Sponsors & CoSponsors
Sponsor
Courtney, Joe [D-CT-2]
CT • D
Cosponsors
Del. Norton, Eleanor Holmes [D-DC-At Large]
DC • D
Sponsored 3/24/2026
Rep. Evans, Dwight [D-PA-3]
PA • D
Sponsored 4/22/2026
Rep. Lieu, Ted [D-CA-36]
CA • D
Sponsored 4/22/2026
Levin
CA • D
Sponsored 4/27/2026
Roll Call Votes
No roll call votes available for this bill.
View on Congress.gov