Student loan changes coming this July
Experts detailed what federal student loan borrowers need to know as components of student loan reform take effect beginning on July 1.
Estimates have suggested that student loan debt currently sits just under $2 trillion, according to a news article from CBS News. As part of the One Big Beautiful Bill Act that passed in 2025, the U.S. Department of Education recently finalized a plan that will terminate some student loan repayment options and introduce new borrowing limits.
For instance, the experts noted that starting July 1, graduate and professional degree students will have respective loan caps of $20,500 and $50,000 per year and $100,000 and $200,000 total. Those who have taken out federal loans on the Parent PLUS program will no longer be able to borrow the full cost of tuition; rather, they will be limited to borrowing $20,000 per year and $65,000 per student. Lifetime student loan caps will be set at $257,500 for all those who borrow after July 1. The changes have already led to concerns that limiting student loan borrowing could exacerbate shortages across healthcare.
Further, starting July 1, new borrowers will no longer be able to select the Graduate PLUS plan and will only be able to choose between the Tiered Standard Plan or the Repayment Assistance Plan. Although those with existing loans can still access the Standard Repayment Plan, Extended Repayment Plan, Graduated Repayment Plan, Income-Based Repayment plan, Pay As You Earn plan and Income-Contingent Repayment plan or switch to the Repayment Assistance Plan, the experts emphasized that the Pay As You Earn, Income-Contingent Repayment and Saving on a Valuable Education plans will be ended by July 2028.
Additionally, low-income students who receive nonfederal grants and scholarships meeting or exceeding the cost of attending a program will no longer be eligible for Pell Grants; however, those enrolled in short-term workforce training programs such as nursing assistance may qualify for the grants.
The experts advised borrowers who need to transition to new plans to make sure their contact information is up to date and speak with their loan servicers for assistance during the change.
Read more: CBS News
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