Federal Student Loan Paperwork Gets a Name Change and Annual Expiration Date

The Student Loan Contract Act of 2025 is a piece of legislation that doesn’t change interest rates or repayment plans, but instead focuses on the paperwork—specifically for federal student loans made under Part D of the Higher Education Act. Think of it as a significant administrative cleanup that affects how you sign up for money for college.

Goodbye MPN, Hello 'Student Loan Contract'

If you’ve taken out federal loans before, you’ve likely signed a document called the Master Promissory Note, or MPN. This bill officially renames that document the “student loan contract” for all Part D loans starting with school periods after the Act becomes law (Sec. 2). While the name change itself might seem minor, it’s a move toward clearer, more accessible language—a “contract” sounds a lot more serious and legally binding than a “note,” which is probably the point. The bill also updates existing disclosure requirements to ensure this new “student loan contract” is explicitly included in the stack of documents students must receive when taking out the loan (Sec. 2).

The One-Year Shelf Life Rule

Here’s the part that actually changes how students interact with the system: currently, an MPN can often be used for multiple years of borrowing. This bill puts a hard stop on that convenience. Under the new rule, once a student signs the “student loan contract,” they can only use that single document to take out additional Part D loans within the same award year as the first loan they signed up for (Sec. 2).

What does this mean in real life? If you’re a student, you can’t sign the contract in your freshman year and automatically use it again in your junior year. You’ll have to sign a brand-new contract every single academic year you borrow. For administrators, this means systems need to be updated to treat these contracts as having an annual expiration date. While it adds a bit of paperwork every year, the upside is that it forces students to review the terms and acknowledge their debt obligation annually, rather than relying on a document they signed years ago. It’s a procedural step designed to keep borrowers more engaged with their borrowing decisions, one year at a time.