Bill · S. 4169· Senate(119-S-4169)
Student Loan Interest Elimination Act
- Introduced
- 3/24/2026
- Last activity
- 3/24/2026 — Read twice and referred to the Committee on Health, Education, Labor, and Pensions.
- Sponsored by
- Peter Welch
- Cosponsors
- - 1 - 0
- Introduced
- In Committee
What this bill would do
This bill, known as the "Student Loan Interest Elimination Act," aims to amend the Higher Education Act of 1965. It seeks to eliminate interest on student loans and establish the Education Affordability Trust Fund. The legislation includes provisions to modify existing Federal Direct loans and refinance certain non-Federal direct loans to remove interest. It also establishes new terms for future Federal student loans and sets annual and aggregate loan limits that adjust for inflation. Additionally, the bill creates a supplemental Federal Pell Grant Program funded by excess amounts from the new trust fund.
Yes· 3 of 8
Would students be better off under this?+10
The bill directly targets student debt by removing interest and increasing loan limits and grant potential.
Does this make college cost less?+10
The bill eliminates interest on existing and future student loans and increases supplemental Pell Grant opportunities.
Would people in their twenties and thirties be better off under this?+9
Young adults often face the highest student loan burdens, which this bill seeks to mitigate through zero interest.
The opposite
No question was scored the opposite.
Who it would affect, and how
Potential Positive Impacts for People
-
Elimination of interest on existing loans: The Secretary would modify eligible Federal Direct loans so that no interest accrues starting July 1, 2026 (Section 102(a)(1)).
-
Refinancing of non-Federal loans: Borrowers with eligible non-Federal direct loans can have them refinanced into Federal Direct Consolidation Loans with no interest accruing (Section 102(b)(2)(A) and (C)).
-
No origination fees on refinanced loans: The Secretary is prohibited from charging borrowers origination fees for loans made under the refinancing program (Section 102(b)(2)(B)).
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Protection of repayment terms: Refinanced loans will not result in an extension of the original loan's repayment period (Section 102(b)(2)(D)).
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Increased loan limits and inflation adjustments: The bill increases annual and aggregate loan limits, which are adjusted for inflation starting July 1, 2027 (Section 203).
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Supplemental Pell Grants: The Secretary may use excess trust fund amounts to provide additional Federal Pell Grants to students (Section 301(a)).
Potential Negative Impacts for People
-
Termination of interest subsidized loans: No new Federal Direct Stafford Loans may be made after June 30, 2026 (Section 202(a)).
-
Requirement to opt-out: While the bill allows borrowers to opt out of loan modifications or refinancing, the change to the terms of the loan is implemented without action from the borrower (Section 102(a)(1) and (b)(1)).
Groups and Interests Ranking
Every group the model scored this bill for, from -10 to +10. Hover a score for the reason it gave.
- Demographic And Interest Groups
- Good For Students+10Good For Young Adults+9Good For Low Income Households+8Good For Middle Class Households+7
- Education And Technology
- Improves College Affordability+10
- Social Issues And Justice
- Improves Poverty Reduction+6
- Economy And Finance
- Improves Economic Growth+5
- Governance And Ideology
- Improves Government Transparency+3
- 3/26/2026
- 1 Cosponsor added.
- 3/24/2026
- Read twice and referred to the Committee on Health, Education, Labor, and Pensions.
- Introduced in Senate
One bill Congress.gov lists as related to this one — companions in the other chamber, earlier versions, and bills this one absorbed or was folded into.
John FettermanDemocrat · Pennsylvania