Congress passes College Cost Reduction and Access Act, creating Income-Based Repayment and Public Service Loan Forgiveness

Congress passes the College Cost Reduction and Access Act (CCRAA), creating the Income-Based Repayment (IBR) plan and Public Service Loan Forgiveness (PSLF) program. IBR caps payments at 15 percent of discretionary income (for new borrowers) with forgiveness after 25 years. PSLF forgives remaining balances after 120 qualifying monthly payments for borrowers employed in public service. The legislation reduces interest rates on subsidized federal loans and increases Pell Grant maximums. These programs dramatically expand forgiveness pathways for federal student loan borrowers and prioritize lower-income borrower relief.