Under the One Big Beautiful Bill Act (OBBBA), the U.S. Department of Education has made the decision to significantly decrease the amount of money students can borrow through federal loans. Until now, graduate students could rely on either Parent PLUS or Grad PLUS loans, federal loans that allowed them to borrow up to the full cost of attendance, including tuition, housing, books, and other expenses.
Starting July 1, 2026, The Dept. of Ed will cap the maximum amount of money a person can borrow per year through Parent PLUS loans at $20,000, with a lifetime maximum of $65,000. Grad PLUS loans will be completely closed off to new borrowers. These drastic cuts towards federal student loans threaten to make education even more difficult to afford, negatively impacting both students and occupations alike.
The plans re-classify a number of degrees to be either standard or professional, which decides whether or not people remain eligible for higher federal loan amounts. This re-classification has significantly narrowed the number of eligible “professional programs” to only 10 fields, including dentistry, medicine, and law. Under the new classification, fields such as nursing, social work, education administration, and STEM research are not considered professional for loan purposes despite the extensive schooling that these professions require.
The department proposes a new solution to replace previous federal loan programs called the “new and simplified” Repayment Assistance Plan (RAP). The RAP allows graduate students in standard programs to borrow $20,500 per year, up to $100,000 total, while students remaining in professional programs may borrow $50,000 per year, up to $200,000 total, roughly twice the amount of standard degrees.
Even prior to the passing of the OBBBA, nursing staff have been experiencing a shortage. The American Association of Colleges of Nursing says there is an average of nine nurses for every 1,000 people in the United States. By cutting back on loans for nurses, this issue may further escalate, creating an even greater scarcity of nurses in the United States. A 2023 study conducted by the Bureau of Labor Statistics said this shortage will only worsen, estimating that by 2030, 42 out of the 50 states will likely experience shortages in nursing staff.
With the new loan cap, many programs that used to qualify for larger loan amounts are no longer able to. According to The Association of American Medical Colleges, the median cost for four years of public medical school in 2025 was $286,454, with about half of medical students taking out Grad PLUS loans. The RAP loan wouldn’t be able to cover the full expenses for medical school, and students may have to apply for private loans, second jobs, or drop out of the program altogether.
According to the National Association of Student Financial Aid Administrations, the average student loan interest rate ranges from 6.53% to 9.08% for federal loans, while their private counterparts range from 3.74% to 17.99%. In the long run, taking out private loans may leave students with even greater payments.
Despite the already passed OBBBA, the Dept. of Ed is still in the rulemaking phase to implement the exact specifics of the RAP, as well as any other related student loan changes. At this time, the public still has some influence regarding the issue. The public can submit comments on the U.S. Department of Education website, which are required to be reviewed before final regulations are set.
These loan cuts decrease access to affordable education, and risk pushing students out of professions already experiencing a shortage of staff. These changes make education harder to reach and greatly diminish the future of America’s workforce.
