Changes to Federal Loans Effective for the 2026-27 School Year
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Disclaimer: The content on this page is provided by Wesleyan University financial aid personnel solely for informational purposes. It reflects our current interpretation of federal loan regulations but is not an official or binding statement of policy. Students are urged to consult the U.S. Department of Education’s official publications and website (One Big Beautiful Bill Act Updates | Federal Student Aid) for definitive guidance.
Wesleyan will continue to update this site as more clarification from the federal government is released. We are here to help. If you have questions or would like to speak with a financial aid staff member, please contact the Financial Aid Office. In the meantime, please note:
- There are no changes to annual undergraduate student loan amounts or undergraduate aggregate loan limits.
- For new parent borrowers, Parent PLUS loans will be capped at $20,000 per student per year, with a $65,000 lifetime limit per dependent student.
- If the student or parent borrower has a Federal Direct Loan made before July 1, 2026, the parent can continue to borrow Parent PLUS Loan for up to the remaining cost of attendance for three academic years or the remainder of the student’s expected time to credential, whichever is less.
- The Unsubsidized Direct Loan program for all graduate students will continue, but with new loan limits for certain borrowers.
- The Graduate PLUS Loan program is not available to borrowers enrolling in new programs for the 2026-27 academic year and beyond.
- Students enrolled in graduate school before July 1, 2026, may still be eligible for Graduate PLUS Loan under current rules.We are here to help. If you have questions or would like to speak with a financial aid staff member, please contact the central Financial Aid Office.
- Parent Plus Loans
- Starting July 1, 2026 for new borrowers, Parent PLUS loans will be capped at $20,000 per student per year, with a $65,000 lifetime limit per dependent student.
- Existing Parent PLUS borrowers who have borrowed for their students before July 1, 2026, can continue with the current limits (up to the cost of attendance, minus other financial aid) for three more years or until the student’s program ends.
- Changing majors does not affect Parent PLUS Loan eligibility. An undergraduate student who changes majors within the same degree or certificate is considered enrolled in the same program of study.
- Loan Proration for Less Than Full-Time Enrollment
- The bill includes a provision to prorate undergraduate and graduate loan amounts based on enrollment.
- Half-time students (e.g., as defined by each program) would only be eligible for a portion of the annual loan limit.
- Students enrolled less than half-time (part-time) are not eligible for federal student loans.
- Loan proration applies to both borrowers under the pre-July 1, 2026, legacy provisions (limited exceptions) and new borrowers on or after July 1, 2026.
- Further guidance regarding loan proration will be forthcoming from the Department of Education.
- New Repayment Options
- For borrowers with all loans disbursed on or after July 1, 2026, the bill eliminates the income-driven repayment plans (IBR, PAYE, SAVE) and replaces them with a new Repayment Assistance Program (RAP).
- Students who borrowed loans before July 1, 2026, and borrow again after July 1, 2026, are limited to the new RAP or the standard plans. All loans must be paid under the same repayment plan.
- RAP borrowers will not be locked into a 30-year plan. They can switch to a standard plan, which ranges from 10 to 25 years.
- Borrowers with no new loans made on or after July 1, 2026, are eligible to enroll in the current Standard Income Based (IBR), Graduated, and Extended repayment plans, and could also opt in to the new RAP.
- Borrowers enrolled in ICR, PAYE, or SAVE plans must transition to a new repayment plan by July 1, 2028. If no selection is made by that date, they will be moved into RAP.