Frequently Asked Questions

Annual caps will be set at $20,500 for graduate students and $50,000 for professional students. In the aggregate, loans will be capped at $100,000 for graduate students and $200,000 for professional students.

The new loan limits take effect on July 1, 2026.

The bill provides an exception to the limits for borrowers enrolled in a program of study prior to July 1, 2026 to allow them to complete their program subject to the prior loan limits. Under this exception, if a student has a Graduate PLUS Loan made before July 1, 2026, while enrolled in a graduate or professional degree program, the student can continue to borrow from the Graduate PLUS Program for three academic years or the remainder of their expected time to credential, whichever is less.

The bill defines graduate student as a student enrolled in a program of study that awards a graduate credential (other than a professional degree) upon completion of the program. The bill defines professional student as a student enrolled in a program of study that awards a professional degree (as defined under section 668.2 of title 34, Code of Federal Regulations) upon completion of the program.

In order to change the definition of graduate student or professional student, Congress would need to pass a new law amending the OBBBA language. To change the definition of professional degree, the U.S. Department of Education would need to do so through the negotiated rulemaking process. Both of these are time-consuming processes and are unlikely to happen.

An LL.M. degree, also known as a Master of Laws, is a graduate degree that allows students to study a specialized area of the law. As a graduate degree, LL.M. students’ borrowing would be capped at $20,500 per year and $100,000 in the aggregate.

No. Any amount borrowed for a graduate degree will be subtracted from the amount available to borrow for a professional degree, just as any amount borrowed for a professional degree will be subtracted from the amount available to borrow for a graduate degree. In total, students who borrow federal loans for both a graduate and a professional degree may only borrow up to $200,000.

The lifetime borrowing cap will be $257,500 on all federal student loans ($200,000 for graduate and professional degrees, plus $57,500 for undergraduate degree).

The HR1 legislation introduces significant changes to the federal loan program. If you are currently enrolled, you are likely grandfathered into the existing loan structure. However, taking a Leave of Absence (LOA) that extends past July 1, 2026, breaks that continuity. Upon your return, you will be considered a "new" borrower under the revised federal rules and will no longer have access to the Graduate PLUS Loan. 

A withdrawal—whether official or unofficial—carries significant financial consequences:

• Termination of Interim Exception: Any withdrawal from the program for which the student received a Direct Loan permanently ends Interim Exception eligibility, even if the student subsequently re-enrolls.
• Reset of Enrollment Status: Returning to the same program after a withdrawal is treated as a new enrollment, subjecting the student to new OBBBA loan limits.

These rules apply to:

• Semester withdrawals
• Program withdrawals
• Administrative withdrawals
• Unapproved leaves of absence

Borrowers may reach one of several federal limits:

Annual Loan Limits

• Once reached, the student cannot borrow more for that award year.

Aggregate Loan Limits

Borrowers who reach their aggregate limit:

• Cannot receive additional loans until some portion is repaid, even if they qualify for the Interim Exception.

Lifetime Maximum Loan Limit

OBBBA establishes a new lifetime cap of $257,500 for all Direct Loans (excluding PLUS). Once reached:

•  The borrower cannot receive additional Direct Loans, regardless of program level or exception status.

Eligibility Retained

Students maintain their exception eligibility under the following circumstances:

• Continued enrollment in the same program of study

• Approved leaves of absence

• Changes in institutional ownership or campus reaffiliation

• Periods of non-attendance that do not constitute an official or unofficial withdrawal

Eligibility Lost

Exception eligibility is permanently forfeited under the following conditions:

• Enrollment extending beyond the standard, published program length (including part-time pacing)
• Any official or unofficial withdrawal, even in the event of subsequent re-enrollment
• Transferring to a different academic program
• Changing graduate-level programs
• Pursuit of joint degrees spanning across different distinct programs

A concurrent degree program is defined as:

• A single, integrated course of study
• A curriculum leading to two degrees awarded simultaneously
• A unified curriculum officially approved as a single program by the institution and/or accreditor

Federal Implications:

• Concurrent degree students retain Interim Exception eligibility, provided the program is officially recognized as a single course of study for federal purposes.