What are the major student loan policy changes coming in 2025?

First, the federal government plans to move student loan management from the Department of Education to the Small Business Administration or Treasury Department. This could affect how you apply for loans, repay them, or contact customer service. There may also be changes to federal loan repayment plans, loan forgiveness, and tax rules, although they’re not yet final.

Will there be any new student loan forgiveness programs in 2025?

So far, no new forgiveness programs have been approved this year. Lawmakers are still debating whether to change current programs like Public Service Loan Forgiveness (PSLF) or income-driven repayment forgiveness. However, these changes are more likely to result in fewer options for students, not more.

Should I refinance my student loans before the 2025 changes take effect?

It depends. Most of the potential 2025 student loan changes are still uncertain. Borrowers on income-driven repayment plans or working toward Public Service Loan Forgiveness might want to wait and see how it all shakes out. However, borrowers with good credit scores might be able to get a better interest rate by refinancing to a private loan, lowering their monthly payments and paying less over the life of the loan. Refinancing to a private loan could also provide stability in a time of uncertainty, as policy changes to federal student loans would not impact your private loan terms.

Will the student loan changes in 2025 impact private student loan interest rates?

The 2025 policy changes apply to federal loans, not private ones. Your private loan interest rate depends on your lender and the current market, not federal rules. That said, if the overall economy shifts because of these changes, lenders could adjust their rates too—but not directly because of the student loan policies.

Will closing the Department of Education make private student loans a better option?

Closing the Department of Education probably won’t affect the appeal of federal loans. However, other actions might. For example, if Congress makes changes to federal student loan forgiveness or eligibility, it could make private loans more appealing. Nothing is final, and students should keep an eye on any changes.

For Students Archives - Ascent Funding

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