March 18 (UPI) — The Trump administration introduced a proposal Monday to set limits on federal student borrowing programs as part of a series of reforms to the Higher Education Act.
The loan limits outlined in the proposal would apply to Direct PLUS Loans, which are used for graduate or professional students, and parents of dependent undergraduate students to pay for college or career school, a White House official said during a press call on Monday.
The official didn’t clarify what the loan cap would be, but it may vary by program rather than by institution.
Additionally, the administration called for Congress to consolidate the five income-driven repayment options into a single plan that caps monthly payment at 12.5 percent of a borrower’s discretionary income.
The proposal states this would offer students loan forgiveness after 180 months of repayment for all their undergraduate loans.
Other reforms mentioned in the proposal include expanding Pell Grant eligibility to “include high-quality, short-term programs that provide students with a credential, certification, or license in a high-demand field” and calling on Congress to include more opportunities in the Federal Work Study to provide work in related areas to the student’s field of study.
It also proposed providing financial aid to prisoners eligible for release to “improve employment outcomes and reduce recidivism.”
“Members of Congress who are committed to ensuring Americans thrive in today’s strong, modern, and growing economy should support and pass these reforms,” White House press secretary Sarah Huckabee Sanders said in a statement.
“We need to modernize our higher education system to make it affordable, flexible and more outcome oriented so that all Americans, young and old, can learn the skills they need to secure and retain good-paying jobs,” she said.