What does Preamble of Student Loan Interest Elimination Act do?

This bill, formally titled 'To amend the Higher Education Act of 1965 to eliminate interest on student loans, establish the Education Affordability Trust Fund, increase annual and aggregate loan limits, and for other purposes,' aims to modify the Higher Education Act of 1965. The bill proposes to eliminate interest on student loans. It also seeks to establish the Education Affordability Trust Fund. The legislation intends to increase both annual and aggregate loan limits.

What does PROGRAM AUTHORITY. of Student Loan Interest Elimination Act do?

This section amends Section 451(a) of the Higher Education Act of 1965. The amendment requires the use of funds available from the Education Affordability Trust Fund, as outlined in section 494A, before other funds. The amendment modifies language regarding subsections. The amendment adds authority to make loans under section 460A(b).

What does PROGRAM FOR THE LOAN MODIFICATION OF ELIGIBLE FEDERAL DIRECT of Student Loan Interest Elimination Act do?

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What does APPLICABLE RATES OF INTEREST FOR LOANS MADE ON OR AFTER JULY of Student Loan Interest Elimination Act do?

This section amends Section 455(b)(8) of the Higher Education Act of 1965. The amendment inserts 'and before July 1, 2026' after 'July 1, 2013' in several subparagraphs (A, B, C, and D). Subparagraph (F) is redesignated as subparagraph (G). A new subparagraph (F) is added, establishing a 0 percent interest rate for certain loans. The 0 percent interest rate applies to Federal Direct Unsubsidized Stafford Loans, Federal Direct PLUS Loans, and Federal Direct Consolidation Loans with a first disbursement or application received on or after July 1, 2026.

What does TERMINATION OF INTEREST SUBSIDIZED LOANS. of Student Loan Interest Elimination Act do?

This section amends the Higher Education Act of 1965 regarding Federal Direct Stafford Loans. No new Federal Direct Stafford Loans may be made after June 30, 2026. Funds are not authorized to be appropriated or expended for Stafford Loans with a first disbursement after June 30, 2026. Beginning July 1, 2026, students will not be eligible to receive interest-subsidized Federal Direct Stafford Loans. Students will be eligible for Federal Direct Unsubsidized Stafford Loans, with the maximum annual amount determined by section 428H, plus the amount they would have received in subsidized loans.

What does ANNUAL AND AGGREGATE LOAN LIMITS. of Student Loan Interest Elimination Act do?

This section amends Section 455(a) of the Higher Education Act of 1965. The amendments modify paragraph (4) and (6) to include references to paragraphs (8) and (9). A new paragraph (9) is added to adjust loan limits for inflation. Starting July 1, 2027, loan limits specified in paragraphs (4) and (6) will increase based on an annual adjustment percentage. The 'annual adjustment percentage' is defined as the estimated percentage change in the Consumer Price Index, determined by the Secretary.

What does SUPPLEMENTAL FEDERAL PELL GRANT PROGRAM. of Student Loan Interest Elimination Act do?

This section amends Section 401(b) of the Higher Education Act of 1965 to establish a Supplemental Pell Grant Program. The program utilizes excess amounts described in section 494A(c). Eligible students, those already receiving a Federal Pell Grant, would receive an additional Pell Grant. The amount of the additional grant is proportional to the student’s existing Pell Grant relative to the total Pell Grants awarded. The additional grant amount may exceed the maximum or be lower than the minimum Federal Pell Grant. The total Federal Pell Grants awarded to a student, including the additional grant, may exceed the maximum Pell Grant. Periods of study covered by the additional Pell Grant are excluded from determining a student's duration limit.

What does USE OF FUNDS FROM THE REPAYMENT OF FEDERAL STUDENT LOANS. of Student Loan Interest Elimination Act do?

This section amends the Higher Education Act of 1965 to establish Section 494A regarding the use of funds from the repayment of federal student loans. It creates an Education Affordability Trust Fund and requires the Secretary of Education to deposit loan repayment amounts into this fund. A Trust Fund Board will transfer assets from the Trust Fund's investments to cover the Department of Education's administrative costs related to student loans. The percentage of assets transferred depends on the Trust Fund's asset level over a 180-day period, ranging from 0% to 100%. Excess amounts, after covering administrative costs, may be used for the Supplemental Federal Pell Grant Program and the Postsecondary Student Success Program. Eligibility for the Postsecondary Student Success Program is restricted to institutions that meet certain tuition increase or endowment size criteria. The Secretary of Education must report to Congress on the use of any excess funds.

What does EDUCATION AFFORDABILITY TRUST FUND. of Student Loan Interest Elimination Act do?

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What does IMPLEMENTATION. of Student Loan Interest Elimination Act do?

This section outlines the implementation of amendments made by titles I, II, and III. The Secretary of Education is authorized to waive certain requirements. These waivers pertain to the master calendar requirements under section 482 of the Higher Education Act of 1965. Waivers can also be applied to negotiated rulemaking under section 492 of the Higher Education Act of 1965.