Changes to Student and Parent Federal Loans

The following legacy provisions apply to current borrowers who receive federal student or parent loans before July 1, 2026.

Undergraduate Students:

• Federal Direct Subsidized and Unsubsidized Student Loan annual borrowing limits remain unchanged.
• Federal Direct Subsidized and/or Unsubsidized Student Loan borrowers’ lifetime maximum of $57,500 remains unchanged.

Parents of Undergraduate Students:

• If a Parent PLUS Loan is disbursed before July 1, 2026, the parent borrower will be allowed to continue to borrow under prior regulations. Under this Legacy Provision, the parent may continue borrowing up to the full cost of attendance (minus other aid), for up to three academic years, or until their dependent student completes their current program/ceases enrollment, whichever scenario happens first. No action is required to retain this legacy status.
• Parent PLUS borrowers will not be subject to the new annual or lifetime maximums by the recent reconciliation bill passage.

Graduate Students:

• The annual Federal Direct Unsubsidized Student Loan borrowing limit remains unchanged at $20,500.
• Under the Legacy Provision, graduate students with a Graduate PLUS Loan disbursed before July 1, 2026, may continue to borrow through the Graduate PLUS Loan program for three additional years OR until they finish their current degree program/cease enrollment, whichever scenario comes first.

The following provisions apply to new borrowers who receive federal student or parent loans beginning July 1, 2026.

Undergraduate Students:

• The annual Federal Direct Subsidized and Unsubsidized Student Loan borrowing limits remain unchanged.
• Federal Direct Subsidized and/or Unsubsidized Student Loan borrowers’ lifetime maximum is $57,500.

Parents of Undergraduate Students:

• Parent PLUS Loan borrowers will be subject to new borrowing limits. 
  • Annual Maximum: $20,000 per year, per dependent student
  • Lifetime Maximum: $65,000 total per dependent student without regard to amounts forgiven, repaid, cancelled, or discharged. 

Graduate Students:

• The Graduate Student PLUS Loan Program is no longer a borrowing option at the graduate level. It has been discontinued for new graduate students.
• The annual Federal Direct Unsubsidized Student Loan borrowing limit for graduate students remains unchanged at $20,500. 
• A lifetime borrowing maximum of $100,000 will be introduced for new graduate borrowers. 

Undergraduate and/or Graduate Students:

• All new federal student loan borrowers will have a lifetime borrowing maximum of $157,500. 
  • $57,500 as an undergraduate student
  • $100,000 as a graduate student 
• The lifetime borrowing maximums exclude borrowed Parent PLUS Loan amounts. 
   

Student borrowers are not required to begin repayment on federal student loans until 6 months after they have graduated or dropped below half-time. At that time, the loan servicer(s) would reach out to the student borrower directly to set up a repayment plan. The student is responsible for repayment, even if they do not hear from their loan servicer. Student borrowers can find their loan history, loan servicer, and loan servicer contact information by logging into their FSA account at studentaid.gov.

Current borrowers with no new loans made on or after July 1, 2026, are eligible to enroll in the current Standard, Graduated, Extended, or current Income-Based Repayment (IBR) plans, and may also opt in to the new Repayment Assistance Plan (RAP). Current borrowers may also switch between, enter, or remain on existing Income-Driven Repayment (IDR) plans until July 1, 2028. 

Current borrowers enrolled in any of the following:

• Income-Contingent Repayment (ICR) Plan
• Pay As You Earn (PAYE) Plan
• Saving on a Valuable Education (SAVE) plan 

Must transition to one of the following plans: 

• Current Standard Graduated or Extended plans
• Income-Based Repayment (IBR)
• Repayment Assistance Plan (RAP)

By July 1, 2028, if no selection is made, the borrower will be transitioned into RAP automatically. If not eligible for RAP, the borrower will be placed in IBR.

Student borrowers that have loans prior to and after July 1, 2026, will only have access to the new Standard Repayment Plan and RAP.  These are the only two repayment options available for borrowers with both old and new loans.

Student borrowers with new federal student loans originating on or after July 1, 2026, will have access to the new Standard Repayment Plan and the Repayment Assistance Plan (RAP). These are the only two repayment options available for new loans issued on or after July 1, 2026.

For parents who borrow Parent PLUS loans on or after July 1, 2026, and parents who had borrowed Parent PLUS before July 1, 2026 and are also subsequently borrowing from the program on or after July 1, 2026, repayment for all loans must be repaid under the New Standard Repayment Plan. They are not eligible for RAP. 

Details of the repayment plans can be found on studentaid.gov. Student borrowers should contact their loan servicer for additional information.