Fact checked by Betsy Petrick
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Since late March, over 1,200 international student visas have been revoked.
With so many changes to the Department of Education and student loan servicing, it’s difficult to foresee how much Trump’s policies could cost the United States economy. Changes to repayment plans and collecting on defaulted student loans could make it challenging for borrowers to make payments. Additionally, the increased number of revoked international student visas is transforming the U.S. into a less attractive destination to study abroad, which could result in approximately $44 billion in lost revenue in a given year.
Key Takeaways
- Trump’s dismantling of the Department of Education and the administration’s proposed changes to income-driven repayment may make paying off student loans more challenging.
- The increased number of international students having their visas revoked and the crackdown on campus free speech may give rise to international students studying elsewhere.
- While it’s difficult to calculate the cost of Trump’s policies, the revenue loss from fewer international students in the U.S. could reach $44 billion per year.
What Has Changed for Students Since Trump Was Reelected?
Trump’s first 100 days saw sweeping changes for education, including federal student loan policy. Each of these shifts may negatively impact the U.S. economy, though by how much remains to be seen.
Trump’s Efforts to Eliminate the Department of Education
In March 2025, Trump made it clear he would like to dismantle the Department of Education, which would require Congressional approval. Following the announcement, the Department of Education stated it would cut 50% of its workforce as part of its “final mission.”
This move would entail the transfer of the management of federal student loans to the Small Business Administration (SBA). The Health and Human Services Inspector General, who’s responsible for government oversight, stated that the SBA has recently had a 40% reduction in its workforce and isn’t equipped to handle the sheer scale of the federal student loan portfolio. The Inspector General warns borrowers will experience “…erratic and inconsistent management of their federal student loans. Errors will prove costly to borrowers and ultimately, to taxpayers.”
Changes to IDR Plans
The status of the Saving for a Valuable Education (SAVE) plan has been tied up in the courts for months, but the block on the program was recently upheld. Although SAVE remains listed as a repayment option on the Federal Student Aid website, borrowers can no longer select it an option. The existing 8 million borrowers enrolled in SAVE will remain in an interest-free forbearance until the situation is resolved or servicers are able to bill borrowers for the appropriate monthly amount.
Defaulted Student Loan Collections Restarting Soon
Student loan repayment has been on and off again since the pandemic. However, the Department of Education began collecting on defaulted student loans on May 5, 2025. Borrowers who don’t make payments or sign up for a payment plan will see their wages garnished starting this summer. The collection process will impact the more than 5 million borrowers currently in default.
Tip
If it’s been a while since you logged in to your student loan account, be aware that your loan servicer may have changed.
International Students and Student Loans
Amid the massive shifts in the Education Department’s priorities and the crackdown on campus free speech, over 1,200 international students have had their visas or legal status revoked since late March.
Unlike U.S. citizens, international students studying in the U.S. cannot receive federal student loans. Since international students bear the responsibility for financing their education, they inject billions of dollars every year into the economy. During the 2023–2024 academic year, international students contributed nearly $44 billion and supported over 378,000 jobs in the U.S. If these students don’t see the U.S. as a safe and viable option, then other countries stand to reap these benefits.
The Bottom Line
Students, both domestic and international, have never faced more uncertainty when taking out student loans. For those local to the U.S., the massive changes to the Department of Education and workforce cuts will likely lead to confusion and costly mistakes.
If you have student loans, it’s important to document the payments you’ve already made (especially if you’re on an income-driven repayment (IDR) plan) and stay in touch with your loan servicer to avoid falling behind on payments.