H.R. 7810 — Lowering Student Loans Act

This section establishes a fixed 2% interest rate on the unpaid principal balance for Federal Direct Stafford Loans, Federal Direct Unsubsidized Stafford Loans, Federal Direct PLUS Loans (including those to parents for dependent students), and Federal Direct Consolidation Loans for which the first disbursement or application is received on or after July 1, 2026, while limiting prior interest rate formulas applicable after July 1, 2013, to loans disbursed before that date. For existing such loans with rates greater than 2%, it reduces the rate to 2% beginning July 1, 2026 (from rates under prior formulas tied to 10-year Treasury notes plus add-ons of 2.05%-4.60%), subject to the Secretary of Education providing borrowers notice at least 90 days prior and permitting opt-out within 90 days after notice; other loan terms remain unchanged. (Thus, these changes apply to the federal government's primary direct lending programs under the William D. Ford Federal Direct Loan Program, which provide unsubsidized and need-based subsidized loans to students and loans to graduate students and parents.) The section further requires the Secretary to notify loan servicers at least 90 days prior to the changes and to establish a borrower complaint resolution process for implementation errors or delays, and it authorizes borrowers of consolidation loans under the Federal Family Education Loan (FFEL) Program to consolidate into Direct Consolidation Loans to obtain the 2% rate.