HR-8475 — Savings Opportunity and Affordable Repayment Act

YourVoice.Now Summary

Your MoneyTransparency & Accountability

A new student loan plan: $0 payments below 250% of the poverty line, with the rest canceled in 10 to 15 years.

Your Money

Income protected from any payment — everything below 250% of poverty line

The line moves with your family size. Money you make under it would not count when your bill is set. A spouse's pay counts too, unless you file taxes on your own.

Loan forgiveness — remaining balance canceled after 15 years of payments

If you only owe for a college program of two years or less, the plan ends after 120 payments. Others need 180, and months at $0 or on hold for job loss, military duty, or cancer care count.

Parent PLUS and old bank-issued loans — eligible for income-based repayment

Any loan made or backed by the federal student loan programs would count. That takes in PLUS loans a parent took out for a child and old bank-held loans.

Cancellation without an application — the government tracks and clears it

The Education Department would have to count your payments and clear the debt once you reach the mark. You would not have to file forms or prove you qualify.

Payment if you miss the yearly income check — 10-year standard amount

You would have to confirm your pay and family size every year. Miss the date and you would be moved off the plan, at the price of a 10-year loan.

Monthly payment on higher income — 5% for college, 10% for grad loans

The 5 and 10 percent rates are split by how much of each type you borrowed. The Education Department would check your pay each year, or sooner if you ask after a job loss.

Balance growth from unpaid interest — none while on the plan

Interest your payment does not cover would not be added to what you owe. Half of each payment cuts the debt itself, and the rest of it is put off, not piled on.

Older income-based plans — closed to new borrowers two years after enactment

Two older plans, Pay As You Earn and income-contingent repayment, would stop taking new sign-ups. Those already on them could stay, but anyone who leaves could not come back.

Transparency & Accountability

Notice explaining your payment — how it was set, how to dispute it

The Department would have to mail you a notice with the payment and the math behind it. It must also say who to call if the amount looks wrong.

More about this bill

Monthly payments on federal student loans would fall to $0 for borrowers below a set income line. That line is 250 percent of the federal poverty line for your family size. Above it, you would pay 5 percent of your income on college loans. Loans for graduate school would cost 10 percent of the income above the line. The new plan, called SOAR, would open about six months after the bill becomes law. Interest that your payment does not cover would not be charged to your account. So the balance would not grow while you stay on the plan. Half of each payment would go straight to the amount you borrowed. Whatever is left after 15 years of payments would be canceled. Borrowers who only owe for programs of two years or less would wait 10 years. Months with a $0 payment still count, and so do many deferments. Parents with PLUS loans and people with older bank-issued loans could use the plan. You would confirm your income and family size once a year. If you miss that step, you would be moved to a plan priced like a 10-year standard loan. Two older income-based plans would close to new borrowers two years after the bill becomes law. Borrowers who leave those plans could not sign up again. The Education Department would track who has earned cancellation and clear those debts without an application.

Congressional Summary

Savings Opportunity and Affordable Repayment ActThis bill creates a new income-driven repayment plan for student loans called the Savings Opportunity and Affordable Repayment (SOAR) plan. The SOAR plan has similar provisions to, but further expands on, the Department of Education's (ED's) final rule published on July 10, 2023, that created the Saving on a Valuable Education (SAVE) plan. The SAVE plan was blocked by federal courts.The bill directs ED to carry out a SOAR plan program that complies with specified requirements. The bill allows all federal student loan types to be eligible for repayment under the SOAR plan, including Parent PLUS Loans and Federal Family Education Loans.Under the SOAR plan, a federal student loan borrower whose income is at or below 250% of the federal poverty level (FPL) has $0 monthly payments. A borrower whose income is over 250% of the FPL pays 5% of their discretionary income on loans obtained for undergraduate study and 10% of their discretionary income for all other outstanding loans (e.g., loans obtained for graduate study).Additionally, under the SOAR plan, holders of eligible federal student loans (e.g., ED or private lenders) must apply 50% of the borrower's monthly payment toward outstanding principal. The other 50% must be applied in the following order: (1) accrued charges and collection costs on the loan, (2) outstanding interest, and (3) outstanding principal.ED must forgive any loan balance that remains outstanding after a specified maximum repayment period (e.g., 10 years or 15 years).

Details

Congress: 119th
Chamber: House
Status: summarized
Action: Introduced in House
Action Date: 2026-04-23
Date Added: 2026-05-19
Source: Congress.gov →

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