Natalia Rodriguez
Staff Writer
Starting July 1 college students and graduate students will see changes to their financial aid packages.
The changes are thanks to the Republican so-called “One Big Beautiful Bill Act,” the federal budget law approved by Congress last year, that makes sweeping changes in government spending, from military to healthcare to education.
For college students, the law reduces the total amount students may borrow for education at the undergraduate, graduate and professional levels. The law eliminates altogether the Graduate Plus Loan, a credit-based federal loan for graduate and professional students.
Initially, the Graduate Plus Loan allowed students to borrow up to the full cost of attendance annually. Combined with new limits to other graduate loans— which allow students to borrow up to $20,500 annually and $100,000 for a lifetime limit— it might become more difficult for students to afford their graduate degree.
“It’s part of a broader attempt to consolidate power in the federal government,” Jason Neidleman, professor of political science, said.
In recent decades, financial aid has seen two major changes: one in 2008 and the other in 2012.
In 2008, Stafford Loan limits increased under the Higher Education Opportunity Act. The amount increased by $2,000 annually, meaning the aggregate limit increased as well. For example, the aggregate prior to the changes was $23,000 for most dependent students; it then became $31,000 with a maximum of $23,000 for subsidized loans.
Meanwhile, the Consolidated Appropriations Act of 2012 added limitations to the Pell Grant, reducing the lifetime eligibility from 18 semesters to 12. At the time, the maximum Pell Grant a student could receive was $5,550 per year. If they exceeded the 12 semesters for receiving this funding, they would not be eligible to obtain the award. Despite this reduction, people with the standard four-year degree would not have been affected much.
This newest change in financial aid would essentially pull back the changes from 2008.
“Having a substantial change now is not just new and unusual, it’s essentially unheard of,” Laura Evans, director of financial aid at the University of La Verne, said. “The number of changes, the types of changes and the severity of the change have not occurred in the past in the federal student aid programs.”
Evans said this change will essentially push students and their families to opt for private loans with companies such as Wells Fargo and Sallie Mae. However, these companies have different borrower protections, loan limits, and interest rates to federal loans.
“And when you add to the fact that the private loans don’t have as many borrower protections, that means that even the folks who do qualify for a private loan are still taking on a higher risk than if they were able to borrow federal loans for that amount,” Evans said.
Additionally, families also have to qualify on a basis of credit, so not everyone may be eligible.
Returning students who have previously borrowed federal loans will have a grace period, called a legacy period, with a maximum of three calendar years, in which they will be allowed to continue receiving funds under the old rules. For incoming students—freshmen, transfers and graduate students—the changes will be immediate.
However, this legacy period only stays in effect as long as students remain enrolled in the same program of study at the same university.
Additionally, part-time students will receive less than the maximum loan amounts. Their loan disbursements will be calculated depending on their enrollment for the year.
“Starting Fall 2026, everyone will have their enrollment evaluated before they can receive a loan disbursement, and if their enrollment is less than full-time for the academic year, they will receive a smaller portion than if they had been full-time,” Evans said.
“Unfortunately, due to the nature of the legislation, there’s not actually a ton that we can do in terms of mitigating the gaps that students will experience,” she added. “Our primary goal is to ensure that students have robust counseling opportunities and robust loan borrowing education processes.”
At the moment, California is working to mitigate the gap for students involved in certain accredited social welfare programs, social work, or nursing and medical school under the California Health Care Workforce Supplemental Loan Act. This act, currently in progress, would match the amount students could borrow for the Graduate PLUS program.
Evans said she is working to keep students informed on the ways the changes will personally affect them. She advises students to carefully monitor their email for any additional updates and review their loan borrowing history.
For more information, visit admissions.laverne.edu/portal/obbba-faq.
Natalia Rodriguez can be reached at natalia.rodriguez@laverne.edu.
Natalia Rodriguez is a senior creative writing and communications major. She is a member of ULV's The Blank Page Writer's Club and has served as a staff member for the school's literary magazine, Prism Review. She is currently arts editor and a staff photographer for the Campus Times and previously served as a staff writer.
