Federal Student Loan Changes Beginning July 1, 2026

The One Big Beautiful Bill Act (OBBBA) includes significant changes to federal student aid programs that take effect on July 1, 2026. These changes may affect undergraduate students, graduate and professional students, and parents who borrow through the Federal Direct Loan Program.

Students and families planning to borrow federal loans for the 2026–2027 academic year or later should review these changes carefully.

Prorated Federal Loan Eligibility for Less Than Full-Time Enrollment

Beginning with the 2026–2027 academic year, students who enroll less than full-time could have their Federal Direct Loan eligibility prorated based on their enrollment intensity. Students must still meet the minimum half-time enrollment requirement to remain eligible for Federal Direct Loans.

Examples:

• Undergraduate Student: Full-time enrollment is 12 credits per semester. An undergraduate student enrolled in 6 credits (half-time) during the fall semester would be eligible to receive 50% of the annual Federal Direct Loan limit, based on current federal guidance.
• Graduate or Professional Student: Full-time enrollment is 6 credits per semester. A graduate or professional student enrolled in 3 credits (half-time) would be eligible to receive 50% of the annual Federal Direct Unsubsidized Loan limit. Based on the current annual limit of $20,500, a half-time student would be eligible to borrow up to $10,250.

*The U.S. Department of Education is expected to release further guidance on the implementation of loan proration. Please keep in mind that the examples provided are for illustrative purposes only. Final federal regulations and guidance may alter how loan eligibility is prorated.

Parent PLUS Loan Changes

Beginning July 1, 2026, Parent PLUS Loans will be subject to new federal borrowing limits for students who do not qualify under the legacy provisions. These limits apply regardless of amounts that have previously been repaid, forgiven, canceled, or discharged.

• Maximum annual Parent PLUS Loan: $20,000 per dependent student 
• Maximum aggregate Parent PLUS Loan: $65,000 per dependent student 

*Worcester State University has an institutional policy to cap borrowing at $16,250 per year so that the PLUS loan lifetime limit is not exceeded prior to completion of the fourth year of study.   A family may request to borrow up to $20,000 per year but must do so in writing to the Financial Aid Office.

Parent Plus Loans Legacy Provisions

Some borrowers may continue to qualify under the previous federal borrowing rules. To qualify for the legacy provisions, a student must meet the following criteria:

• Were enrolled in the same eligible program before July 1, 2026, 
• They had a federal student loan for their field of study disbursed before July 1, 2026. 

This legacy provision allows borrowers to use the program for three academic years or for the remainder of their current program, whichever is less.

*Additional eligibility requirements apply. The University will provide updates as additional federal guidance becomes available.