Key Changes Effective July 1, 2026
On July 4, 2025, the H.R.1 bill (One Big Beautiful Bill Act) was enacted into law. Significant provisions regarding Federal Loan limits will affect entering college students going into effect July 1, 2026. Legacy provisions for current borrowers will allow borrowing under current federal loan limits for the remainder of their program of study.
What are the new loan limits for Undergraduate students?
Lifetime Direct Loan borrowing cap
- $257,500 across all federal Direct Loans, which includes Undergraduate and Graduate borrowing.
Parent PLUS Loan borrowing cap
- Annual cap: $20,000 per year per student.
- Lifetime cap: $65,000 per student—for parents borrowing under PLUS.
IMPORTANT NOTE: Students who borrow the maximum amount of $20,000 per year, may run out of PLUS eligibility by their Senior year due to the $65,000 lifetime limit.
What are the new loan limits for Graduate and Professional students?
Lifetime Direct Loan borrowing cap
- $257,500 across all federal Direct Loans, which includes Undergraduate and Graduate borrowing.
Annual Direct Unsubsidized Loan limits
- Graduate degrees: max $20,500/year, aggregate cap $100,000.
- Professional degrees: max $50,000/year, aggregate cap $200,000.
The federal definition of eligible professional degree programs is expected to include Dentistry (D.D.S. or D.M.D.), Law (L.L.B. or J.D.), Medicine (M.D.), and Clinical Psychology (Psy.D. or Ph.D.).
IMPORTANT NOTE: The Grad PLUS Loan program is eliminated for new borrowers after July 1, 2026.
What are my next steps?
Actions to take on Federal Student Loans (Undergraduate, Graduate, and Professional Students)
- Current student borrowers will be allowed to borrow under current student loan limits.
- To take advantage of the current limits for the remainder of your academic program, you should make a decision on borrowing your 2025–26 loans by taking action on your Bruin Financial Aid Portal, completing all loan requirements, and have funds disbursed by the end of the Spring 2026 semester/quarter to remain eligible for current loan limits.
Actions to take on Federal Parent PLUS Loans OR Graduate PLUS Loans:
- To take advantage of the current Parent PLUS OR Graduate PLUS loan limits, parents of current students and current Graduate students should make a decision on borrowing PLUS loans for the 2025–26 year by completing all PLUS Loan Application requirements and have funds disbursed by the end of the Spring 2026 semester/quarter to remain eligible for current loan limits.
Spotlighted FAQ's
Who is considered a new borrower?
Anyone who did not take out a loan during their current program study and before July 1, 2026 or will be starting a new degree program in the 26/27 academic year.
What other loan options will I have to fill the gaps that aren’t covered by Federal loans?
Credit based private loans can be used to fill the gaps that aren’t covered by Federal loans. We encourage students to review the UC Preferred Private Lender List as a starting point.