A 2025 federal law rewrote the borrowing limits for graduate students and parents. If you’re starting a program now, the old ceilings no longer apply.
Key numbers
- Grad PLUS loans ended for new borrowers on July 1, 2026.
- Graduate students can borrow up to $20,500 a year and $100,000 in total; professional students $50,000 a year and $200,000 in total.
- Parent PLUS loans are capped at $20,000 a year and $65,000 in total per dependent student.
- Students and parents already borrowing for a program may keep the old rules for up to three more academic years.
The 2025 budget reconciliation law, often called the One Big Beautiful Bill Act, made the biggest changes to federal student lending in years. The new limits apply to loans for programs starting on or after July 1, 2026.
The new limits
| Borrower | Annual limit | Aggregate limit |
|---|---|---|
| Graduate students | $20,500 | $100,000 |
| Professional students (such as medicine or law) | $50,000 | $200,000 |
| Parent PLUS, per dependent student | $20,000 | $65,000 |
| All federal student loans combined, per borrower | $257,500, not counting Parent PLUS |
Undergraduate loans don’t count toward the $100,000 or $200,000 graduate limits, but they do count toward the $257,500 lifetime cap.
What ended
Grad PLUS loans, which let graduate students borrow up to the full cost of attendance, are no longer available to new borrowers. For many graduate programs, especially expensive ones, that leaves a gap between the new federal limits and the cost of attendance.
Who keeps the old rules
Students who already had federal loans for a program before July 1, 2026 can generally keep borrowing under the previous rules for up to three more academic years, or until they finish, whichever comes first, as long as they stay in the same program. Parents who borrowed Parent PLUS loans for a student before that date get a similar transition. Changing programs can end the grandfathering, so ask your aid office before you switch.
Note
These limits come from statute, but the Department of Education’s implementing rules, including which programs count as professional, continue to be finalized. Check StudentAid.gov and your school’s financial aid office for the rules that apply to you.
Planning around the new caps
- Compare the full cost of the program with the new limits before you enroll.
- Ask about assistantships, fellowships and tuition waivers, especially for research programs.
- Look at employer support; tax-free employer education benefits can cover up to $5,250 a year. See employer tuition assistance.
- If you must borrow privately, understand what you give up; see federal vs. private student loans.
New loans also come with new repayment rules. Here’s how the Repayment Assistance Plan works.
Questions families ask
Did undergraduate loan limits change?
The annual and aggregate limits for undergraduate Direct Loans stayed the same. A dependent first-year student can still borrow up to $5,500.
What counts as a professional program?
Programs such as medicine, dentistry, pharmacy and law fall under the higher professional limits. The Department of Education defines the list, so ask your school how your program is classified.
How do I fill the gap if the new caps aren’t enough?
Look for institutional grants, assistantships and employer support first. Private loans are the other option, but they lack federal protections.
Award amounts, loan limits and tax rules change, and some 2026 rules are still being finalized. This guide is general information for U.S. students and families, not financial or tax advice; confirm details at StudentAid.gov, with the IRS or with your school’s financial aid office.
