One Big Beautiful Bill Act (OBBBA) Information

An aggregate loan limit is the maximum total you are allowed to borrow and keep outstanding at any one time under a specific loan program. It acts as a lifetime ceiling for cumulative debt rather than a yearly cap.

The bill significantly changes federal student loan repayment options for borrowers who receive a new federal loan on or after July 1, 2026. These borrowers will generally have two repayment options:

Tiered Standard Repayment Plan: Provides fixed monthly payments with repayment terms of 10, 15, 20, or 25 years, depending on the borrower's outstanding loan balance.

Repayment Assistance Plan (RAP): A new income-driven repayment plan that bases monthly payments on the borrower's income and number of dependents. Payments made under RAP may count toward Public Service Loan Forgiveness (PSLF) when all other PSLF requirements are met.

Borrowers with loans made before July 1, 2026, may continue to have access to certain existing repayment options for a transitional period.

By July 1, 2028, the SAVE/REPAYE, PAYE, and ICR plans will no longer be available. Borrowers enrolled in these plans will need to transition to another repayment plan for which they are eligible, such as:

• Repayment Assistance Plan (RAP)
• Income-Based Repayment (IBR), if eligible
• Tiered Standard Repayment Plan
• Other eligible legacy repayment options, when applicable

Borrowers who do not select a new plan by the required deadline may be assigned to an eligible repayment plan by the U.S. Department of Education. RAP or the Standard Repayment Plan.

The One Big Beautiful Bill Act (OBBBA), also referred to as OB3, was signed into law on July 4, 2025. The law made several changes to federal student aid programs, including Federal Pell Grants, federal student loans, Parent PLUS Loans, loan limits for students enrolled less than full-time, and student loan repayment plans.

Many of these changes became effective beginning with the 2026–27 academic year. Federal Student Aid continues to provide guidance and updates as the new requirements are implemented.

 One Big Beautiful Bill Act Updates | Federal Student Aid

Yes. Beginning with the 2026–27 award year, there are additional requirements that may affect Pell Grant eligibility.

For example, a student with a Student Aid Index (SAI) equal to or greater than twice the maximum Pell Grant award for the year is not eligible for a Pell Grant. For 2026–27, that SAI threshold is $14,790.

In addition, students whose non-federal grants and scholarships equal or exceed their Cost of Attendance (COA) are not eligible for a Pell Grant.

The new law does not change the annual or aggregate federal Direct Loan limits for undergraduate students. At SoLAcc, annual loan limits are based on a student's year in school and dependency status.

• First-year dependent student: up to $5,500
• First-year independent student: up to $9,500
• Second-year dependent student: up to $6,500
• Second-year independent student: up to $10,500

The total (aggregate) undergraduate loan limits are:

• Dependent students: $31,000
• Independent students: $57,500

Beginning with the 2026–27 academic year, students enrolled less than full-time may not be eligible to receive the full annual loan amount. Loan eligibility must be reduced based on enrollment under the new Schedule of Reductions (SOR) requirements.

Your actual loan eligibility may also be limited by your Cost of Attendance, other financial aid, previous borrowing, and remaining aggregate loan eligibility.

Yes. Beginning July 1, 2026, the new law establishes a $257,500 lifetime limit on federal student loans for borrowers subject to the new loan limits.

This lifetime limit includes federal student loans borrowed for undergraduate, graduate, and professional study. Amounts that have been repaid, forgiven, canceled, or discharged still count toward the lifetime limit.

The $257,500 lifetime limit applies to loans borrowed by the student and does not include Parent PLUS Loans borrowed by a parent.

Some students may qualify for an exception from the new loan limits based on their prior enrollment and borrowing history.

Beginning with the 2026–27 academic year, federal Direct Loan annual limits must be reduced for students who are enrolled less than full-time.

This is called the Schedule of Reductions (SOR).

At SoLAcc, 12 credit hours per semester is considered full-time for undergraduate students. A full academic year is generally based on 24 credit hours.

For example, a first-year dependent undergraduate student has a $5,500 annual Direct Loan limit.

If the student enrolls in 6 credit hours for the fall semester, the student is enrolled in 6 of the 24 credit hours used for the academic year calculation.

6 ÷ 24 = 25%

The student would be eligible for up to 25% of the $5,500 annual loan limit, or $1,375 for the fall semester, subject to all other federal student aid eligibility requirements.

Changes to your enrollment may affect your remaining federal student loan eligibility.

For example, if you receive a loan based on your fall enrollment and later drop courses, the reduced enrollment must be considered when SoLAcc determines your remaining loan eligibility for the academic year.

Dropping courses could therefore reduce the amount of additional federal student loans you are eligible to receive in a later semester.

Generally, no. For students enrolled in a semester-based program, the amount of the annual federal Direct Loan limit available for a single semester is limited based on the portion of the academic year covered by that semester.

At SoLAcc, the academic year is generally based on 24 credit hours over the fall and spring semesters. Therefore, a student enrolled full-time for only one semester would generally be limited to 50% of the applicable annual loan limit.

For example, a first-year dependent student with a $5,500 annual loan limit would generally be eligible for up to $2,750 for one full-time semester, subject to Cost of Attendance, other financial aid, previous borrowing, and all other federal eligibility requirements.

Students enrolled less than full-time may have a lower loan limit under the Schedule of Reductions (SOR).

Yes. Parent PLUS Loans remain available, but new borrowing limits apply to parents who are subject to the new OB3 loan limits.

The limits are:

• Up to $20,000 per academic year per dependent student
• A $65,000 aggregate Parent PLUS limit per dependent student

The $65,000 limit applies without regard to amounts previously repaid, forgiven, canceled, or otherwise discharged.

Some continuing students and their parents may qualify for a temporary exception from the new limits.

Reaching the $65,000 Parent PLUS aggregate limit does not make a dependent student eligible for the additional Unsubsidized Direct Loan amount normally available when a parent cannot obtain a PLUS Loan.

A dependent student may still qualify for additional unsubsidized loan eligibility when a parent is unable to borrow a Parent PLUS Loan due to certain qualifying circumstances, such as a PLUS Loan denial based on adverse credit.

Yes. OB3 created a new federal student loan repayment framework.

For borrowers subject to the new repayment provisions, repayment options generally include:

• A new Tiered Standard Repayment Plan
• The Repayment Assistance Plan (RAP)

Which repayment plans are available to you will depend on when you borrowed your federal student loans and the types of loans you have.

Students should review their current repayment options on StudentAid.gov before selecting a repayment plan.

Yes. The Public Service Loan Forgiveness Program remains available.

Qualifying payments made under the new Repayment Assistance Plan (RAP) may count toward PSLF when all other PSLF eligibility requirements are met.

No. The new law does not change how students qualify for Federal Work-Study.

For now, Work-Study eligibility will continue to be based on financial need as determined by the FAFSA and institutional packaging policies. Schools will still decide how much Work Study funding is available and which students are offered it.

No. The FAFSA is an application for federal student aid. Completing it does not guarantee eligibility for a particular type or amount of aid.

Your financial aid eligibility may depend on several factors, including:

• FAFSA information and Student Aid Index (SAI)
• Enrollment status
• Program eligibility
• Cost of Attendance
• Grade level and dependency status
• Satisfactory Academic Progress (SAP)
• Previous federal student loan borrowing
• Pell Grant Lifetime Eligibility Used (LEU)
• Federal loan limits
• Other financial assistance received

Not necessarily.

OB3 includes an interim exception for certain continuing students who meet federal requirements. Students who qualify for the exception may temporarily remain subject to the previous federal loan limits for their current program of study.

Eligibility for the exception is determined based on federal requirements and the student's borrowing and enrollment history.

The SoLAcc Financial Aid Office will determine your eligibility after reviewing your FAFSA, enrollment, program, Cost of Attendance, other financial assistance, federal loan history, and all applicable federal student aid requirements.

Your financial aid offer may change if your enrollment or other eligibility information changes.

Federal student aid requirements may continue to be updated as the U.S. Department of Education implements OB3.

Students are encouraged to:

• Monitor their SoLAcc student email and LoLA account
• Review financial aid requirements and notifications
• Visit StudentAid.gov for federal student aid information
• Contact the SoLAcc Financial Aid Office with questions about how these changes affect their individual eligibility