One Big Beautiful Bill Act

Financial Aid

The One Big Beautiful Bill Act (OBBBA), enacted in July 2025, introduces several important changes to student financial aid eligibility beginning with the 2026–2027 academic year. These updates will have a significant impact to financial aid eligibility of both students and parents. Please review the key changes outlined below to understand the implications that take effect July 1, 2026. This information reflects the most current guidance available, but is subject to change.

Undergraduate students

Foreign income and Pell eligibility

  • Requires that foreign income be included in the AGI used to calculate Pell Grant eligibility.

Full COA scholarships and grants

  • Students who receive grants or scholarships from non-federal sources covering their entire cost of attendance (COA) are ineligible to receive a Pell Grant, even if otherwise eligible for the program.

Students with high Student Aid Index (SAI)

  • Prevents students from receiving Pell Grants if their SAI exceeds twice the maximum Pell Grant award.

Less than full-time enrollment—prorated loan amounts

  • If students enroll less than full time (11 credits or fewer) in 2026-27 or future years, their Federal Direct Loan(s) must be prorated in accordance with changes to the law. 

Federal loan program lifetime loan limits

  • Change: $257,500 lifetime borrowing limit on all federal student loans, excluding borrowed Parent PLUS loan amounts (in the case of a dependent student who had ParentPLUS borrowed on their behalf for education expenses). Effective July 1, 2026.
    • Limited exception: If a borrower has a Federal Direct Loan made before July 1, 2026, while enrolled in a credentialed program, the borrower can continue to borrow under current loan limits for three academic years or the remainder of their expected time to credential, whichever is less.

Parent PLUS annual and aggregate loan limits

  • Change: 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). Effective July 1, 2026.
    • Limited exception: If a borrower has a Federal Direct Loan made before July 1, 2026, while the dependent student is enrolled in a credentialed program, the parent can continue to borrow under current loan limits for three academic years or the remainder of their dependent student’s expected time to credential, whichever is less.

Graduate students

Graduate PLUS loan program

  • Effective July 1, 2026 the Graduate PLUS loan program will be eliminated.
    • Limited exception: If a borrower has a Federal Direct Loan made before July 1, 2026, while enrolled in a credentialed program, the borrower can borrow from the GradPLUS program for three academic years or the remainder of their expected time to credential, whichever is less. Effective July 1, 2026.

Loan amounts to be prorated for less than full-time enrollment

  • If students enroll less than full time (5 credits or fewer) in 2026-27 or future years, their federal Direct Unsubsidized and/or Graduate PLUS loans (if they qualify to borrow a Graduate PLUS under the limited exception described above) must be prorated in accordance with changes to the law.

Graduate/professional annual and aggregate loan limits

  • Change: Caps the annual loan limits at $20,500 for graduate students and $50,000 for professional students*. The aggregate limit is capped at $100,000 for graduate students and $200,000 for professional students, and does 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). The lifetime borrowing limit for all federal student loans is $257,500, excluding borrowed Parent PLUS loan amounts. Effective July 1, 2026.
    • Limited exception: If a borrower has a Federal Direct Loan made before July 1, 2026, while enrolled in a credentialed program, the borrower can continue to borrow under current loan limits for three academic years or the remainder of their expected time to credential, whichever is less. 

Student and parent-facing resources

Learn more information related to Federal Student Aid changes from the One Big Beautiful Bill Act.

*A professional student is a student enrolled in a program of study that awards a professional degree, as defined under section 34 CFR 668.2. Examples of a professional degree include but are not limited to Pharmacy (Pharm.D.), Dentistry (D.D.S. or D.M.D.), Veterinary Medicine (D.V.M.), Chiropractic (D.C. or D.C.M.), Law (L.L.B. or J.D.), Medicine (M.D.), Optometry (O.D.), Osteopathic Medicine (D.O.), Podiatry (D.P.M., D.P., or Pod.D.), and Theology (M.Div., or M.H.L.).