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New 2026 Student Loan Caps End Graduate PLUS, Income Plans

6/9/2026

Summary

US Loan Reform

United States federal student loan rules change on July 1, 2026 under the One Big Beautiful Bill Act.
Parent PLUS loans become capped at $20,000 per year and $65,000 lifetime per dependent student.
Graduate PLUS loans are eliminated for new borrowers, and graduate students receive Direct Unsubsidized Loans limited to $20,500 annually and $100,000 lifetime.
Professional degree students can borrow up to $50,000 per year and $200,000 lifetime.
All loans taken out on or after July 1, 2026 are subject to a lifetime borrowing limit of $257,000.
Two income-driven repayment plans – Pay As You Earn and Income-Contingent Repayment – will end in 2028, requiring borrowers to switch to other plans.
Anthony Jones, executive director of scholarships and financial aid at the University of Utah, advises borrowers to contact their loan servicer and keep detailed records of communications.
As of the first quarter of 2026, Americans owe $1.87 trillion in student loan debt, and 10.34 percent of federal loans are 90 days or more delinquent.

Summary

Education Dept Halts SAVE

Settlement in December requires the Education Department to end the SAVE plan after court approval.
The department’s April 2026 release says new rehabilitation, deferment and forbearance rules start July 1, 2027.
The Repayment Assistance Plan will set payments at 1 %–10 % of AGI, $10 minimum for incomes under $10,000, and forgiveness after 30 years.
Analysts warn that doing nothing could be costly because SAVE will no longer count toward Public Service Loan Forgiveness.

History

Historical Context

The 1998 Higher Education Amendments added a campus voter-registration requirement, applying to institutions in states that require pre-election registration and setting a precedent for later aid reforms. The 2008 Higher Education Opportunity Act reauthorized the federal HEA and mandated net-price calculators for nearly 7,000 Title IV schools, expanding cost-transparency for students. The One Big Beautiful Bill Act now builds on those reforms.

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US Loan Reform

United States federal student loan rules change on July 1, 2026 under the One Big Beautiful Bill Act.
Parent PLUS loans become capped at $20,000 per year and $65,000 lifetime per dependent student.
Graduate PLUS loans are eliminated for new borrowers, and graduate students receive Direct Unsubsidized Loans limited to $20,500 annually and $100,000 lifetime.
Professional degree students can borrow up to $50,000 per year and $200,000 lifetime.
All loans taken out on or after July 1, 2026 are subject to a lifetime borrowing limit of $257,000.
Two income-driven repayment plans – Pay As You Earn and Income-Contingent Repayment – will end in 2028, requiring borrowers to switch to other plans.
Anthony Jones, executive director of scholarships and financial aid at the University of Utah, advises borrowers to contact their loan servicer and keep detailed records of communications.
As of the first quarter of 2026, Americans owe $1.87 trillion in student loan debt, and 10.34 percent of federal loans are 90 days or more delinquent.

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