The changes coming to federal student loans in 2026

“At the end of December, a data point shows that, in addition to the current 3-4 million borrowers already in default, an additional almost 3.4 million defaulted borrowers hit the books. This was something I was worried about for a couple of years, it more than doubles the number of borrowers in default. A number higher than we were at pre-COVID.” Betsy Mayotte

“Unfortunately Parent PLUS borrowers got hit harder than most, and I don’t think that has clicked quite yet. Parent PLUS borrowers, people with existing Parent PLUS Loans, if they need access to an income-driven repayment plan, they have to consolidate now. And that consolidation has to be done by July 1, 2026, or they will forever lose access to those IDR plans. Any parent PLUS borrowers that consolidates or takes out another parent PLUS Loan after July 1, 2026, will lose access to all lower payment options forever, on all of their loans. On existing parent PLUS and future loans. Meaning, they will only be able to use the Standard Plan. And if they run into financial issues, they will only have access to limited forbearance and deferment plans.” Betsy Mayotte