Automatic enrollment moves delinquent student borrowers into lower-payment plans

What it does

This bill amends federal student loan law to automatically enroll borrowers who fall 31+ days behind on payments into income-driven repayment plans, using IRS tax data to calculate their income without requiring them to apply. The Department of Education will notify delinquent borrowers of their options, and if they don't select a plan within 75 days, the government will automatically place them in the plan with the lowest monthly payment. Similar automatic enrollment applies to borrowers rehabilitating defaulted loans. The bill also allows IRS to share tax return information with the Education Department for this purpose.

Why we flagged it

The bill's operative mechanism is automatic enrollment of delinquent borrowers into income-driven repayment plans using IRS data, with the goal of reducing defaults and lowering monthly payments for struggling borrowers. This is a targeted intervention in loan servicing and borrower assistance, not a broad policy change.

What the text implies

• Automatic enrollment may reduce borrower awareness of their full range of repayment options, since the Secretary selects a plan rather than presenting all choices equally.
• IRS tax data sharing expands to cover a broader set of loans (covered loans, not just Part D loans), increasing the scope of tax-return disclosure to Education Department.
• Borrowers with zero income or no tax filing requirement may face a $0 payment under some income-driven plans, potentially extending loan terms and increasing total interest paid over time.
• The 75-day automatic enrollment trigger may move borrowers into plans before they have time to seek financial counseling or understand long-term consequences.

Section numbers refer to the bill text the analysis read — linked under Primary records below.

Who it affects

Delinquent borrowers gain automatic access to income-driven repayment plans with lower monthly payments, reducing the risk of default and financial hardship. The bill preserves borrower choice (opt-out rights, ability to change plans) while removing friction that prevents struggling borrowers from accessing relief they are already eligible for.

Who stands to gain

• Student loan servicers (reduced default rates, extended loan terms)
• Federal government (reduced default claims, extended repayment periods)

Named in the bill

Department of Education, Internal Revenue Service, Higher Education Act of 1965, Internal Revenue Code § 6103(l)(13), Income-driven repayment plans, Covered loans (Part D, Part B purchased, assigned loans)

Where it stands

6 cosponsors: 6 Democrats.

• Sep 2, 2026 — Introduced · Congress.gov: “Introduced in House”
• Sep 2, 2026 — Referred to House Committee on Ways and Means and House Committee on Education and Workforce · Congress.gov: “Referred to the Committee on Education and Workforce, and in addition to the Committee on Ways and Means, for…”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.