Federal Loan Updates

Beginning July 1, 2026

Planning ahead, together. Federal student loan changes connected to the implementation of the One, Big, Beautiful Bill Act will roll out over time, with several key changes expected to begin for periods of enrollment starting on or after July 1, 2026. We’ll keep this page updated as federal guidance is released, and we’ll always explain what it mean in plain language.

Federal Loan Limit changes

Undergraduate students may be eligible for up to $20,000 per year in Parent PLUS Loans, with a $65,000 aggregate limit. Student borrowers who are eligible for the legacy exemption may be eligible to continue borrowing under current limits for up to three academic years or the remainder of their program, whichever is less.

Graduate PLUS Loans have been eliminated for new borrowers. Student borrowers who are eligible for the legacy exemption may retain eligibility for up to three academic years or the remainder of their program, whichever is less.

Graduate students may be eligible for up to $20,500 per year in Direct Unsubsidized Loans, with an aggregate limit of $100,000. Student borrowers who are eligible for the legacy exemption may be eligible to continue borrowing under current limits for up to three academic years or the remainder of their program, whichever is less.

Professional students may be eligible for up to $50,000 per year in Direct Unsubsidized Loans, with an aggregate limit of $200,000.

Schedule of Reductions for Annual Loan Limits (starting July 1, 2026)

Beginning July 1, 2026, students enrolled less than full-time will have their annual loan eligibility reduced based on the federal Schedule of Reduction tied to enrollment intensity. Students must be enrolled at least half-time to receive federal student loans.

If you are an undergraduate student in a fall-spring programs, 24 credit hours is the annual full-time enrollment benchmark (12 credits fall + 12 credits spring) used for the Schedule of Reduction (SOR) calculation:

Annual Credits Enrolled	Enrollment Intensity	Percent of Annual Loan Limit
24	100%	100%
23	96%	96%
22	92%	92%
21	88%	88%
20	83%	83%
19	79%	79%
18	75%	75%
17	71%	71%
16	67%	67%
15	63%	63%
14	58%	58%
13	54%	54%
12	50%	50%

Annual enrollment is reviewed when Direct Loans are disbursed. Courses that are dropped or withdrawn are not included in the enrollment calculation. As a result, dropping or withdrawing from a course may reduce your annual Direct Loan eligibility. Students should consult the Office of Student Financial Planning before making enrollment changes.

What you’ll see from us: If this applies to you, we’ll show it clearly in your award notice and help you plan before disbursement.

What the new loan limits mean for students:

If you are currently enrolled in a program of study and have borrowed a Federal Direct Loan prior to July 1, 2026, the new loan rules may not apply right away. If you have remaining eligibility within your program’s published length, current (“legacy”) loan limits may continue to apply for up to three years or until you reach the published length of your program—whichever comes first—provided you remain continuously enrolled in the same program.

Annual Direct Loan limits

You can continue under the current annual limits during the transition period

PLUS Loan availability

Grad PLUS: Students who qualify for this transition can continue to access Grad PLUS under the current loan program.
Parent PLUS: Parents of dependent undergraduates can continue to borrow up to Cost of Attendance minus other aid under the current loan program during the transition period.

Keep your eligibility (enrollment matters)

If a student withdraws or ceases enrollment, they generally lose the limited transition treatment and are treated under the post–July 1, 2026 rules when they return.
If you lose your legacy status—by withdrawing, changing your program, or reaching the published length of your program—the new loan limits will apply.

New Annual Direct Limits (by student level)

Undergraduate (no changes): $5,500 — $12,500
Graduate Unsubsidized: $20,500
Professional unsubsidized (based on the NEW federal definition): $50,000

Lifetime Aggregate Limits (by student level)

Undergraduate (no changes): $31,000 — $57,500
Graduate (not including undergraduate): $100,000
Professional (combined grad/prof; not including undergraduate): $200,000

Lifetime Direct Loan Limit (excluding PLUS)

$257,500 lifetime Direct Loan limit, counted on the original amount borrowed even if repaid, forgiven, canceled, or discharged.

PLUS Loans

Graduate PLUS: eliminated for periods of enrollment beginning on or after July 1, 2026.
Parent PLUS: subject to new limits (annual and aggregate)
- Annual: $20,000 per student
- Aggregate: $65,000 per student (based on original amount borrowed).

Beginning with the 2026-27 award year, certain programs may qualify for higher federal Direct Unsubsidized Loan limits based on their federally assigned CIP (Classification of Instructional Programs) code, not solely on the degree title.

Programs currently recognized as professional programs include:

Medicine (M.D.) – CIP 51.12
Pharmacy (Pharm.D.) – CIP 51.20
Law (J.D.) – CIP 22.01
Clinical Psychology (Psy.D.) – CIP 42.28

Additional programs currently affected by an interim court stay are being awarded under the standard graduate annual loan limit of $20,500 rather than the higher professional program limit:

Theology (M.Div.) – CIP 39.06
Nursing (DNP, MSN, Ph.D.) – CIP 51.38
Athletic Training (MATR) – CIP 51.09
Medical Science (MMS) – CIP 51.09
Occupational Therapy (OTD) – CIP 51.23
Physical Therapy (DPT) – CIP 51.23

Professional-program loan-limit eligibility is determined by federal CIP code classification under current law and guidance, not by degree title alone. Students with questions regarding their program’s classification or loan eligibility should contact the Office of Student Financial Planning.

New borrowers in these programs on or after July 1, 2026 will be subject to the new loan limits for professional students.

Contact Us for Help!

We can help you:
- Confirm what applies based on your enrollment, program, and prior Direct Loan disbursement.
- Understand how enrollment changes may affect borrowing.
- Build a plan that supports your path to graduation.

Disclaimer

Due to the significant amount of changes that are occurring, portions of our website may not yet be 100% accurate. We’ll continue to update this page as we receive more information from the Department of Education and Federal Student Aid, and appreciate your patience as we work to implement the changes brought by the One, Big, Beautiful Bill Act.

Please contact the Office of Student Financial Planning at financialplanning@mercer.edu for any inquiries or further clarification.

Federal Student Loan Updates