Student loan borrowers could see payments spike under Trump’s ‘big, beautiful’ bill:

President Trump’s proposed changes to student loan repayment options could lead to a significant increase in monthly payments for borrowers. The GOP spending bill aims to reduce the current repayment options to just two, affecting both future borrowers and those currently on the Biden-era SAVE plan.

Under the new budget, borrowers may see their monthly payments rise by hundreds of dollars, as analyzed by the Student Borrower Protection Center. The end of the SAVE plan will be replaced by the Repayment Assistance Plan (RAP), which calculates payments based on a percentage of discretionary income without a payment cap.

Consumer finance expert Erica Sandberg expressed concerns about the impact of these changes, noting that many low- and middle-income borrowers could end up paying more under the new plan. The only other option for borrowers would be the standard plan, which will see some adjustments to the repayment period based on loan size.

Despite the potential changes, the final approval of the budget is pending in the House. In the meantime, borrowers are advised to maintain good standing with their lenders and explore forbearance or deferment options if needed. Utilizing loan calculators and selecting the most affordable repayment plan is crucial for managing student loan debt effectively.