Pew Commends Signing of Bill That Streamlines Student Loan Repayment for Millions

WASHINGTON—The Pew Charitable Trusts applauds the signing into law today of legislation designed to significantly improve the process that student loan borrowers use to enroll and remain in income-driven repayment plans.

The Fostering Undergraduate Talent by Unlocking Resources for Education (FUTURE) Act—passed by Congress Dec. 10 and signed into law today by President Donald Trump—includes provisions authorizing the sharing of data between the Internal Revenue Service and the U.S. Department of Education, thus streamlining burdensome and duplicative income verification requirements for student loan borrowers in income-driven repayment plans. These plans, which tie monthly payments to family size and income, tend to be more affordable than the standard repayment plan, in which monthly payments are set at fixed amounts paid for up to 10 years.

Sarah Sattelmeyer, manager of Pew’s student borrower success project, issued the following statement:

“Recent research by The Pew Charitable Trusts found that a staggering 1 in 4 student loan borrowers defaulted in the first five years of repayment. By tearing down a significant barrier facing those who try to access, or remain in, income-driven repayment plans, this legislation should reduce the number of Americans who struggle with loan payments.

“Data-sharing between the IRS and the Department of Education will be a great help to the roughly 8 million borrowers enrolled in income-driven repayment plans and could help millions more in the future. This change in federal policy also will lay a solid foundation for additional improvements to the repayment system.

“Congress and the administration, working together in a bipartisan fashion, should be commended for taking a major step toward helping borrowers who are already facing, or most at risk of, delinquency and default to enroll in affordable repayment plans.” 

The Pew Charitable Trusts is driven by the power of knowledge to solve today’s most challenging problems. Learn more at pewtrusts.org.