The One Big Beautiful Bill Act

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Last Updated: May 05, 2026, 03:39 PM

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2026-2027 Updates

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law.  The following information is designed to provide continual guidance on what has changed related to federal student aid programs.  While many of these changes are still working through the finalization process within the Department of Education (DOE), these regulations are scheduled to become effective on July 1, 2026.

Disclaimer:  As the Department of Education releases further guidance and finalizes the rules, we will continue to update this page with the most accurate and actionable information available. Please visit Federal Student Aid for the latest updates. 

Undergraduate Student Changes

  • Federal Direct Subsidized and Unsubsidized Student Loans

    • Borrowers will not see any changes to eligibility or lifetime loan limits under the One Big Beautiful Bill Act.

  • Parent PLUS Loan Annual and Aggregate Loan Limits

    • All parents (combined) may borrow $20,000 per year per dependent student and a $65,000 aggregate limit per dependent student (without regard to amounts forgiven, repaid, canceled or discharged).
    • Legacy Provision: If a borrower has a Federal Direct Loan disbursed before July 1, 2026, while the dependent student is enrolled in a degree seeking program, the parent can continue to borrow under current loan limits for 3 academic years or the remainder of their dependent student's plan of study with continuous enrollment, so if a student withdraws or stops out for a semester they will no longer be under the legacy provision. 

  • Schedule of Reduction

    • Students enrolled less than full-time (full-time = 12 credit hours per semester for undergraduate students) will have their federal loans reduced to match their enrollment.
      • For example:  A student who is enrolled in 6 credit hours in Fall and 6 credit hours in Spring is enrolled in 50% each term.  Their loans will be reduced to 50% of their annual eligibility.  If the student is eligible for $5,500 ($2,750 per semester) at full-time for the two semesters combined, then their adjusted amount will be reduced to $2,750 ($1,375 per semester) to reflect their half-time enrollment.
    • This change could have an effect on students withdrawing from classes after aid is disbursed as aid may have to be adjusted for future semesters.

Graduate Student Changes

  • Graduate PLUS Loan Program

    • This program is ending effective July 1, 2026 and will no longer enroll new borrowers.
    • Legacy Provision:  If a borrower has a Direct Unsubsidized Loan disbursed before July 1, 2026, while enrolled in a program of study, the borrower can continue to borrow from the program for 3 academic years or the remainder of their expected time to credential, whichever is less.

  • Graduate & Professional Annual & Aggregate Loan Limits

    • The annual loan limit is capped at $20,500 for graduate students and $50,000 for professional students (e.g., Medical or Law). The aggregate loan limit is capped at $100,000 for graduate students and $200,000 for professional students.  These amounts do not include amounts borrowed as an undergraduate. (Borrowers who are both graduate and professional students at some point in their educational careers may only borrow up to $200,000 in total for graduate and professional school.)
    • Legacy Provision: If a borrower has a Direct Unsubsidized Loan disbursed before July 1, 2026, while  enrolled in a program of study, the borrower can continue to borrow under current loan limits for 3 academic years or the remainder of their expected time to credential, whichever is less. The student must remain enrolled in the current plan of study with continuous enrollment, so if a student withdraws or stops out for semester they will not longer be under the legacy provision.

  • Schedule of Reduction

    • Students enrolled less than full-time (full-time = 9 credit hours for 16 week semester classes and 6 credit hours for 8 week semester classes) will have their Federal loans reduced to match their enrollment. 
    • This change could have an effect on students withdrawing from classes after aid is disbursed as aid may have to be adjusted for future semesters.