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Student loan policy update

August 6, 2025
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Income and Wealth

Every year, thousands of students across metro Atlanta use federal loans to access higher education. These resources open doors to opportunity for families in all corners of the region. With the recent passage of the “Big Beautiful Bill,” the federal government has made changes to those student loan programs. Here’s what you need to know:

Nonprofit Eligibility

  • The Department of Education can remove PSLF eligibility from nonprofit organizations it determines to have engaged in specific illegal activities, including those related to immigration, terrorism or gender identity (Newsweek, 2025).

Borrowing Limits

  • Graduate students: capped at $20,500 annually.
  • Medical and law students: capped at $50,000 total.
  • Parent PLUS loans: capped at $20,000 per dependent annually, with a $65,000 lifetime maximum.

Pell Grant Eligibility

  • Students with a Student Aid Index (SAI) twice the maximum Pell Grant amount will no longer qualify.
  • Pell Grants will expand to include workforce training at community colleges.

Repayment Plans and Deferment

  • Starting in July 2026, borrowers will have two options: a revised standard plan or a new income-based repayment plan.
  • Borrowers who take loans on or after July 1, 2027, will not be eligible for deferments due to economic hardship or unemployment.

Public Service Loan Forgiveness (PSLF) and Income-Driven Repayment (IDR)

  • The Department has postponed processing PSLF Buyback applications, which allow borrowers to recover credit for past ineligible payments.
  • Staffing cuts at the U.S. Department of Education have delayed payment tracking due to technical challenges (Forbes, 2025).

Federal Student Aid will share comprehensive updates regarding changes to federal student aid programs. Students, parents and borrowers should check here for forthcoming information.

Community Foundation Update

As education policy evolves, the Community Foundation remains committed to creating pathways to opportunity. In communities across metro Atlanta, education continues to be one of the most powerful tools for building a stronger future.

In August 2025, we will relaunch our student debt repayment program to offer direct financial support to borrowers. This program reflects our ongoing investment in making education more accessible for all.

To learn more and stay informed when applications open, visit cfgreateratlanta.org/student-debt.

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