2026-27 Financial Aid Changes: What Actually Changed on July 1
If you are putting together a college budget this summer, the rules moved underneath you. The One Big Beautiful Bill Act rewrote federal student lending for the 2026-27 award year, and the changes are not small: Parent PLUS borrowing has a hard ceiling for the first time, Grad PLUS is gone for new borrowers, and there is now a lifetime cap on federal loans.
This page is the short version, in plain language, with links to the deeper breakdowns. None of it changes aid you have already been awarded. What it changes is how much you can borrow from here forward, and for a lot of families that is the number that decides the school.
Effective for loans first disbursed on or after July 1, 2026. Figures as of July 2026.
Every change, at a glance
Old rule, new rule, and who feels it.
| What changed | Before July 1, 2026 | For 2026-27 | Who feels it |
|---|---|---|---|
| Parent PLUS, per year | Up to the full cost of attendance | $20,000 per dependent student | Parents covering the gap between aid and cost |
| Parent PLUS, lifetime | No limit | $65,000 per student | Parents with a long degree path or more than one child in school |
| Grad PLUS | Up to the full cost of attendance | Eliminated for new borrowers | New graduate and professional students |
| Graduate unsubsidized | $20,500 per year | $20,500 per year, $100,000 lifetime | Master's and doctoral students |
| Professional unsubsidized | $20,500 per year | $50,000 per year, $200,000 lifetime | Medicine, law, dentistry, and 8 other designated fields |
| Total federal borrowing | No lifetime limit | $257,500 across all federal loans | Anyone combining undergraduate and graduate borrowing |
| Part-time borrowing | Full annual limit at any enrollment level | Prorated by credit load, nothing below half-time | Part-time, working, and returning students |
Parent PLUS has a ceiling now
Before July 1, a parent could borrow up to a school's entire cost of attendance through Parent PLUS. That is over. The annual limit is $20,000 per dependent student, and the lifetime limit is $65,000 for that student. For a family that was using Parent PLUS to close a $30,000-a-year gap at a private college, the arithmetic no longer works, and the school list has to change before the deposit does.
Grad PLUS is gone
Grad PLUS used to cover whatever the unsubsidized loans did not. For new borrowers it no longer exists. Graduate students are capped at $20,500 a year and $100,000 in total. Students in the 11 designated professional fields, including medicine, law, and dentistry, get $50,000 a year and $200,000 in total. For programs costing $40,000 to $90,000 a year, the remainder now has to come from institutional aid, an employer, savings, or private loans. Whether nursing and physician assistant programs belong in the lower tier is being litigated.
There is a lifetime cap, for the first time
$257,500 across all federal student loans, undergraduate and graduate combined. Parent PLUS is not counted toward it, because the parent is the borrower rather than the student. If you are planning a long path, a bachelor's degree and then a doctorate, this is the number that decides whether the last degree can be financed federally at all.
Borrowing is now prorated by course load
This is the change almost nobody is discussing, and in our view it is the one most likely to catch people off guard, because it can shrink a loan you already counted on.
Annual loan limits are now multiplied by your share of a full-time course load. If a full-time year is 24 credits and you enroll in 12, you can borrow roughly half of the annual limit, not all of it. Below half-time enrollment, federal student loans are not available at all. Proration applies to new borrowers and, with limited exceptions, to students still borrowing under the pre-July 2026 legacy rules.
If you are working through school on a lighter load, run the real number before you commit to a schedule. The loan you budgeted for may be smaller than the one you have been quoting yourself.
Were you grandfathered in?
If a Parent PLUS or Grad PLUS loan was disbursed for you before July 1, 2026 while you were enrolled in a qualifying program, borrowing can generally continue under the old limits for up to three more academic years, or until you finish that program, whichever comes first.
Two cautions. Changing programs or taking a leave of absence can break the protection. And these transition rules are administered by your school, not by us, so confirm your own status with the financial aid office before you count on it.
What this means, by situation
You were relying on Parent PLUS for the gap
Take the school's net price, subtract everything that is not a loan, and see whether the remainder fits inside $20,000 a year. If it does not, the gap has to close some other way: a cheaper school, a transfer path, an appeal, or private borrowing at worse terms. Do this before the deposit deadline, not after.
You were counting on Grad PLUS
Your federal ceiling is now $20,500 a year for a graduate program or $50,000 for a professional one. Subtract any undergraduate federal debt from the $257,500 lifetime cap to find your real remaining capacity, then ask the program directly what institutional aid exists. A funded offer at a less prestigious program may now beat an unfunded one.
You are part-time or working through school
Confirm what your school counts as a full-time load, then work out your proportional limit before registration. Dropping below half-time now removes federal loan eligibility entirely, so a single dropped course can change how the semester gets paid for.
Run your own numbers
Go deeper
Our full coverage of the 2026-27 changes.
2026-27 Financial Aid Changes: Common Questions
What financial aid rules changed on July 1, 2026?
Four things. Parent PLUS borrowing is now capped at $20,000 per year and $65,000 in total per dependent student. Grad PLUS is eliminated for new borrowers. Federal loans now carry a $257,500 lifetime ceiling across undergraduate and graduate study, which does not count Parent PLUS. And annual loan limits are prorated by how many credits you take, with no federal loans at all below half-time enrollment.
How much can parents borrow in Parent PLUS loans now?
Up to $20,000 per year per dependent student, and $65,000 for that student across their entire education. Before July 1, 2026 a parent could borrow up to the school's full cost of attendance with no ceiling. Parents who already had a Parent PLUS loan disbursed before that date may be able to keep borrowing under the old limits for up to three more academic years.
Can graduate students still borrow federal money without Grad PLUS?
Yes, but less, and with a hard stop. Graduate students can borrow $20,500 a year in unsubsidized loans up to $100,000 total. Students in the 11 designated professional fields, including medicine, law, and dentistry, can borrow $50,000 a year up to $200,000. Grad PLUS used to cover whatever the rest of the bill was. It no longer exists for new borrowers, so any gap above those caps has to come from savings, institutional aid, an employer, or private loans.
Am I grandfathered under the old loan limits?
Possibly. If a Parent PLUS or Grad PLUS loan was disbursed for you before July 1, 2026 while you were enrolled in a qualifying program, borrowing can usually continue under the old limits for up to three more academic years, or until that program is finished, whichever comes first. Switching programs or taking a leave of absence can end the protection, so confirm your own status with your financial aid office rather than assuming.
Can part-time students still get federal student loans?
Only at half-time enrollment or above, and only for a proportional share. Annual loan limits are now multiplied by your share of a full-time course load, so a student taking half of a full-time schedule can borrow about half the annual limit. Below half-time, federal student loans are not available at all.
Sources: the One Big Beautiful Bill Act (signed July 4, 2025), U.S. Department of Education guidance, and NASFAA. Borrowing limits apply to loans first disbursed on or after July 1, 2026. All figures as of July 2026. CampusROI is a data tool, not a financial advisor, and this page is not financial advice. Transition and eligibility rules are administered by your school; confirm your own situation with its financial aid office.