Affordable Loans for Students Act
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed House
- Passed Senate
- To President
- Became Law
Overview
The Affordable Loans for Students Act lowers the interest rate on federal student loans to 2% for new loans and offers refinancing options for existing loans. It allows the Secretary of Education to modify eligible loans without borrower action and establishes a process for refinancing non-direct loans into Federal Direct Consolidation Loans with a 2% interest rate. The bill also includes reporting requirements to track loan modifications and defaults.
Key provisions
- Lowers the interest rate on new federal student loans to 2%.
- Allows the Secretary to modify eligible federal loans without borrower action.
- Creates a refinancing program for non-direct federal loans into Federal Direct Consolidation Loans.
- Establishes a process for paying off existing loans through consolidation loans.
- Provides for a 2.0% interest rate on refinanced loans.
- Requires the Secretary to report on loan modification and default rates annually.
Who is affected
- Students seeking federal student loans
- Borrowers with existing federal student loans
- The Department of Education
- Higher Education Institutions
Notable changes
- Reduces the interest rate on federal student loans significantly.
- Expands refinancing options for borrowers.
- Provides for automatic loan modifications without borrower action.
Bill text
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Sponsors
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