To amend the Higher Education Act of 1965 to double the Pell Grant award amount, improve the Public Service Loan Forgiveness program, and reduce interest rates, and for other purposes.
Sponsors
Legislative Progress
IntroducedMr. Scott of Virginia (for himself, Mr. Subramanyam, Ms. Underwood, …
Summary
What This Bill Does
This legislation (LOAN Act) dramatically reforms federal student aid programs. It doubles the Pell Grant to approximately $15,000 and makes it available to graduate students. It lowers interest rates on federal student loans, eliminates origination fees and interest capitalization, and creates new refinancing programs for both federal and private student loans. It reforms Public Service Loan Forgiveness by reducing the required payments from 120 to 96 months and streamlining the application process.
Who Benefits and How
Undergraduate students receive doubled Pell Grants (up to ~$15,000). Graduate students become eligible for subsidized loans and Pell Grants for the first time. DACA recipients gain federal student aid eligibility. Student loan borrowers benefit from lower interest rates, no origination fees, and new refinancing options. Public service workers qualify for loan forgiveness after 8 years instead of 10. Borrowers in default gain easier paths to remove defaults from credit reports.
Who Bears the Burden and How
Federal government bears significantly increased costs for Pell Grants (mandatory funding), lower interest revenue, and loan forgiveness. Private student loan lenders face new competition from federal refinancing programs. Loan servicers face reduced revenue from lower interest rates and origination fees. For-profit colleges may face scrutiny as Dreamer student provisions specify institution types.
Key Provisions
- Doubles maximum Pell Grant to approximately $15,000 through mandatory funding
- Extends Pell Grant eligibility to 18 semesters and includes graduate students
- Reduces Public Service Loan Forgiveness from 120 to 96 qualifying payments
- Lowers interest rates and eliminates origination fees on new federal loans
- Eliminates interest capitalization on federal student loans
- Creates refinancing programs for federal and private student loans
- Extends federal student aid eligibility to DACA recipients (Dreamer students)
- Restores subsidized loans for graduate students
- Removes default records from credit reports upon full repayment or consolidation
Evidence Chain:
This summary is derived from the structured analysis below. See "Detailed Analysis" for per-title beneficiaries/burden bearers with clause-level evidence links.
Primary Purpose
Comprehensive student loan reform that doubles the Pell Grant to $15,000, reduces student loan interest rates, eliminates origination fees, reforms Public Service Loan Forgiveness, creates refinancing options for federal and private loans, and extends aid to graduate students and DACA recipients.
Policy Domains
Legislative Strategy
"Use mandatory funding to dramatically expand student aid while reducing costs for borrowers through lower rates, eliminated fees, and enhanced forgiveness programs"
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
- "the_secretary"
- → Secretary of Education
- "the_secretary"
- → Secretary of Education
- "the_secretary"
- → Secretary of Education
- "the_secretary"
- → Secretary of Education
Key Definitions
Terms defined in this bill
Non-citizen who entered US before age 16, has been continuously present for 4+ years, and is under Deferred Action for Childhood Arrivals (DACA) or similar protection
Loans made under Part D, purchased under section 459A, or assigned to Secretary under subsection (c)(8) or (j)(3)(B)
Private education loan disbursed before July 1, 2026, for postsecondary educational expenses at an eligible institution
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology