Bill > HR2003

This bill aims to significantly reduce the interest rates on federal student loans to 2 percent for both existing and new loans. The legislation would modify the Higher Education Act of 1965 by establishing two primary mechanisms: first, an automatic loan modification program for federal student loans currently held by the Secretary of Education, which would reduce the interest rate to 2 percent without requiring any action from borrowers; and second, a refinancing program for eligible federal student loans not held by the Secretary. The refinancing process would allow borrowers to convert their existing loans into Federal Direct Consolidation Loans with a 2 percent interest rate, with borrowers having the option to opt out if they choose. The bill covers various types of federal student loans, including Direct Stafford Loans, Unsubsidized Stafford Loans, PLUS Loans, and Consolidation Loans. Importantly, the law stipulates that refinancing would not extend the original loan's repayment period, and borrowers would retain their existing repayment terms. The Secretary of Education would be required to submit annual reports detailing the number of borrowers whose loans have been modified or refinanced and the delinquency rates for these loans. This legislation represents a significant effort to make higher education more affordable by substantially lowering the cost of borrowing for students.

Education

https://www.congress.gov/bill/119th-congress/house-bill/2003/all-info