Colleges must now prove their graduates earn enough to pay back student loans

The US Education Department is proposing new rules that tie federal student loan eligibility to how much graduates earn. This means colleges will lose access to federal student aid if their programs do not lead to graduates earning above a certain threshold.

For decades, colleges could access federal student aid regardless of whether their graduates found jobs that paid enough to cover their loans. This change shifts the risk from students and taxpayers to the institutions themselves. It forces colleges to focus on job outcomes, not just enrollment numbers, to keep their federal funding.