H.R. 7810: Lowering Student Loans Act

This bill, titled the Lowering Student Loans Act, aims to amend the Higher Education Act of 1965 to set the interest rates for Federal student loans at 2 percent, beginning July 1, 2026. Here is a breakdown of its main provisions:

Interest Rates for Federal Student Loans

The bill establishes that:

• New Loans: For Federal Direct Stafford Loans, Federal Direct Unsubsidized Stafford Loans, and Federal Direct PLUS Loans that begin disbursement on or after July 1, 2026, the interest rate will be set at 2 percent.
• Existing Loans: For loans that were issued before July 1, 2026, if the current interest rate is higher than 2 percent, those loans will be adjusted to a 2 percent interest rate starting July 1, 2026.

Consolidation Loans

The provisions for consolidation loans state:

• New Consolidation Loans: Any application for a Federal Direct Consolidation Loan received on or after July 1, 2026, will also have an interest rate of 2 percent.
• Existing Consolidation Loans: For any Federal Direct Consolidation Loan for which an application was made before July 1, 2026, if it has an interest rate above 2 percent, it will be reduced to 2 percent on that same date.

Notice and Opt-Out for Borrowers

Borrowers affected by these interest adjustments will receive:

• A notification from the Secretary of Education at least 90 days before July 1, 2026, informing them of the interest rate changes.
• The option to opt out of these adjustments within 90 days of receiving the notification.

Loan Servicers' Responsibilities

The bill requires the Secretary of Education to:

• Notify student loan servicers of the interest rate adjustments at least 90 days prior to July 1, 2026.
• Establish a process for borrowers to resolve complaints regarding errors or delays related to these changes.

Overall, this bill seeks to make federal student loans more affordable by lowering the interest rate to 2 percent for new and existing loans as of July 1, 2026.

Relevant Companies

• None found