Financial Aid Changes – One Big Beautiful Bill Act (OBBBA)

One Big Beautiful Bill Act (OBBBA)

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) became law, resulting in several changes to federal student aid programs.

When do these changes take effect?

These changes will take effect on July 1, 2026.

What changes should students be aware of?

Beginning July 1, 2026:

• Federal student loan borrowing limits have been updated.
• Changes have been made to the Parent PLUS Loan Program.
• The Graduate PLUS Loan Program has been discontinued.
• Students enrolled less than full-time may be eligible for reduced loan amounts.
• Updated repayment plans; changes have been made to the available federal student loan repayment options.
• Temporary exception provision; some students may be allowed to continue under the previous federal loan rules. To qualify, a student must:
  • Be enrolled in their academic program before July 1, 2026.
  • Have received a federal student loan disbursement prior to that date.
  • Maintain eligibility under the exception for up to three years or until completing their academic program, whichever comes first.

Important: You may lose eligibility for this exception if you change academic programs, withdraw from the University or complete your academic program.

Pell Grant Maximum Award Amount

The Federal Pell Grant is designed to help students with financial need pay for college expenses. However, if the maximum Pell Grant award amount exceeds $14,790, you will not be eligible to receive the grant.

Can I receive a Pell Grant if I receive scholarships or other non-federal aid?

It depends. If the total amount of scholarships, grants, and other non-federal aid you receive exceeds your cost of attendance (COA), you may not be eligible to receive a Pell Grant, even if you otherwise qualify for it.

Should foreign income be included in adjusted gross income?

Yes. This information is used to determine your eligibility for a Federal Pell Grant.

Borrowing Scenarios for Students

If You Are an Undergraduate Student

• The annual and aggregate loan limits remain unchanged from the limits that were in effect before July 1, 2026.
• You may borrow up to a lifetime maximum of $257,500, including any federal student loans that have been repaid in full or forgiven.
• If you are enrolled less than half-time, the loan amount you are eligible to receive for that award year will be reduced based on your enrollment level.

Example: Undergraduate Student: If you enroll in 24 credits during the academic year (12 credits per semester), you may be eligible to borrow the maximum annual loan amount available. However, if you reduce your course load during the first semester by withdrawing from one or more courses, the portion of the student loan you may receive for the second semester will be adjusted based on your updated enrollment level.

• If one or both parents receive a Direct Parent PLUS Loan, the amount they may borrow will be limited. Parents of dependent undergraduate students may borrow up to $20,000 per year, with a lifetime aggregate limit of $65,000. This limit includes any Parent PLUS loans that have been repaid in full or forgiven.
• If one or both parents are denied a Parent PLUS Loan due to an adverse credit history, the student may become eligible for an increased amount of Direct Unsubsidized Loan funding. However, if a parent reaches the annual or aggregate Parent PLUS Loan limit, the student does not become eligible for additional Direct Unsubsidized Loan funds as a result.
• Once parents reach the maximum annual or lifetime Parent PLUS Loan limit, they cannot receive additional Direct Parent PLUS Loans.

If You Are a Graduate Student

• Prior to July 1, 2026, the maximum federal loan limits for graduate students and graduate professional students were the same. Beginning July 1, 2026, students enrolled in a graduate program will have different borrowing limits than students enrolled in a graduate professional program.
• If you are enrolled less than half-time, the amount of federal student loan funding you are eligible to receive during the award year will be reduced based on your enrollment level.

Example: Graduate/Professional Student: If you enroll in 6 credits during the academic year (3 credits per semester), you may be eligible to borrow the maximum annual loan amount available. However, if you reduce your course load during the first semester by withdrawing from one or more courses, the portion of the student loan you may receive for the second semester will be adjusted based on your updated enrollment level.

• If you are enrolled in a graduate program, you may receive up to $20,500 per year in Direct Unsubsidized Loans.
• Students enrolled in a graduate program are subject to new aggregate borrowing limits that differ from the limits in effect before July 1, 2026.
• As a graduate student, you may borrow up to $100,000 in Direct Unsubsidized Loans during your lifetime if you have never attended a graduate professional program. This aggregate limit does not include loans borrowed for undergraduate studies.
• If you are currently enrolled in a graduate program and previously attended a graduate professional program, you may borrow up to $200,000 in Direct Unsubsidized Loans, less any amount previously borrowed for your professional program.
• Graduate and graduate professional students are no longer eligible to receive a Direct Graduate PLUS Loan.
• There is an overall lifetime borrowing limit of $257,500, which includes any federal student loans that have been repaid in full or forgiven.

If You Are a Graduate Professional Student

• Prior to July 1, 2026, the maximum federal loan limits for graduate students and graduate professional students were the same. Beginning July 1, 2026, students enrolled in a graduate professional degree program will have different borrowing limits than students enrolled in a graduate program.
• If you are enrolled in a graduate professional program, you may be eligible for higher annual Direct Unsubsidized Loan limits than were available before July 1, 2026. You may borrow up to $50,000 per year in Direct Unsubsidized Loans.
• If you are enrolled less than half-time, the amount of federal student loan funding you are eligible to receive during the award year will be reduced based on your enrollment level.

Example: Graduate/Professional Student: If you enroll in 6 credits during the academic year (3 credits per semester), you may be eligible to borrow the maximum annual loan amount available. However, if you reduce your course load during the first semester by withdrawing from one or more courses, the portion of your student loan eligibility for the second semester will be adjusted based on your updated enrollment status.

• If you are enrolled in a graduate professional program, you may receive up to $200,000 in Direct Unsubsidized Loans, provided you have not previously been enrolled in a graduate program.

If you were previously enrolled in a graduate program, you may receive up to $200,000 in Direct Unsubsidized Loans, minus any subsidized or unsubsidized loan amounts you previously received for that graduate program.

These aggregate borrowing limits do not include federal student loans received for undergraduate studies.

Note: A graduate professional student is a student enrolled in a professional doctoral degree program that leads to professional licensure required to practice in a specific field.

Temporary Exception Provision

Some borrowers may qualify for what is called a Temporary Exception, which allows them to continue under certain federal student loan rules that were in place before the new changes take effect.

• If you do not qualify for the Temporary Exception, or if you lose eligibility (for example, by changing academic programs, withdrawing from the university, or completing your program), the following rules will apply:
  • The new federal student loan limits will take effect on July 1, 2026.
  • Graduate and graduate professional students will no longer be eligible to receive a Direct Graduate PLUS Loan.
  • You will be subject to a lifetime federal student loan limit of $257,500, which includes all subsidized loans, unsubsidized loans, and Graduate PLUS Loans that have been disbursed to you. Any loans that have been repaid or forgiven still count toward your lifetime borrowing limit. Once you reach the maximum limit, you will not be eligible to borrow additional federal student loan funds.
• If you qualify for the Temporary Exception:
• The new federal loan limits will not apply to you until Award Year 2029–30 (July 1, 2029, through June 30, 2030), unless you take an action that causes you to lose eligibility for the exception.
• As long as you do not have an adverse credit history, you may continue to receive a Direct Graduate PLUS Loan through Award Year 2028–29 (July 1, 2028, through June 30, 2029), or until you no longer qualify for the exception.
• The new lifetime borrowing limit will not apply to you until Award Year 2028–29, or until you lose eligibility for the exception.

Note: Students who are currently receiving a Direct Graduate PLUS Loan may continue borrowing under that program for up to three academic years or until they complete their degree program, whichever occurs first, provided they continue to meet the requirements for the Temporary Exception.

Comparison of Maximum Loan Limits Before and After the OBBBA

Annual Borrowing Limits

Dependent Undergraduate Students (unless a parent is unable to obtain a Direct PLUS Loan due to an adverse credit history)

Independent undergraduate students (and dependent students if their parents are unable to obtain a Direct Loan PLUS Loan due to an adverse credit history).

Direct Parent PLUS Loans

Graduate Students

Students in a Graduate or Professional Program

Aggregate Loan Limits

Dependent Undergraduate Students (unless their parents are unable to obtain a Direct PLUS Loan due to an adverse credit history).

Independent Undergraduate Students (and dependent students if their parents are unable to obtain a Direct PLUS Loan due to an adverse credit history).

Parent PLUS Loans

Graduate Students

Students in a Professional Graduate Program*

*Students enrolled in the Doctor of Nursing Practice (DNP) program who, before July 1, 2026, qualified for higher annual and aggregate borrowing limits may continue to receive loans at those higher limits as long as they remain eligible for the exception. However, once the exception ends (for example, if the student changes programs, withdraws completely, or completes the academic program), the student will become subject to the new borrowing limits described above.

Lifetime Borrowing Limits for Student Borrowers

Changes to Repayment Plans

• Repayment Assistance Plan (RAP)
• Standard Graduated Repayment Plan

Under the Repayment Assistance Plan (RAP), your monthly payment amount is based on your income and the number of your dependents, rather than on your student loan debt, interest rate, and repayment term (as would be the case under the Tiered Standard Repayment Plan). Changes in your income or the number of your dependents will result in changes to your monthly payment amount. If you choose the Repayment Assistance Plan (RAP), you must:

• Authorize access to your tax information from the Internal Revenue Service (IRS) that shows your income and the number of your dependents.
• Provide other documentation of your income (and your spouse’s income, if applicable) and the number of your dependents.

Under the Tiered Standard Repayment Plan, your monthly payment amount is based on:

• The principal balance you owe at the time you enter the plan.
• The interest rate on your loans.
• The length of the repayment period.

For more information and updates regarding the One Big Beautiful Bill Act (OBBBA), you may visit: https://studentaid.gov/es/announcements-events/big-updates