Big Beautiful Bill
Overview
On July 4, 2025, the One Big Beautiful Bill Act became law, bringing major updates to federal student aid programs. Starting July 1, 2026, these changes will begin to reshape how students and families finance higher education. We are currently reviewing the legislation and will continue to provide updates as the U.S. Department of Education and other authorities release additional guidance.
Below is a summary of what we know at this time, how these updates may affect you, and steps you can take to start preparing. This information is intended to help students and families understand and navigate the upcoming changes to federal student aid. It reflects our good faith interpretation of what to expect.
Federal Student Aid Changes for the 2026-27 Aid Year
- Any student who has an SAI that is twice the maximum Pell will not be Pell eligible.
- Students receiving scholarships that cover their full cost of attendance won’t be eligible for Pell.
The new regulations bring about several important modifications to the federal student loan options. Here are the most critical updates effective July 1, 2026:
Loan Limit Comparison
| Loan Type | Current Annual Limit (25/26 Academic Year) | Current Aggregate Limit | New Annual Limit | New Aggregate Limit |
|---|---|---|---|---|
| Undergraduate Subsidized | Freshman-$3,500 Sophomore $4,500 Junior/Senior-$5,500 | $23,000 | Unchanged | Unchanged |
| Undergraduate Unsubsidized for Dependent Students | Freshman-$2,000 Sophomore $2,000 Junior/Senior-$2,000 | $31,000(includes any subsidized loans in the total) | Unchanged | Unchanged |
| Undergraduate Unsubsidized for Independent Students | Freshman-$6,000 Sophomore $6,000 Junior/Senior-$7,000 | $57,500(includes any subsidized loans in the total) | Unchanged | Unchanged |
| Graduate Unsubsidized Loans | $20,500 | $138,500 (includes undergraduate borrowing) | $20,500 | $100,000 (Graduate level loans only) |
| Graduate PLUS Loans | Up to the cost of attendance minus other sources of financial aid | None | Eliminated | Eliminated |
| Parent PLUS Loans | Up to the cost of attendance minus other sources of financial aid | None | $20,000 per dependent student | $65,000 per dependent student |
- If a parent is denied a Parent Plus loan, a dependent freshman/ sophomore student can borrow up to an additional $4,000 in unsubsidized loans. A dependent junior/senior may borrow up to an additional $5,000 in unsubsidized loans.
- If a student is not eligible for a subsidized loan, the total annual loan amount for the unsubsidized loan would be the combination of the subsidized and unsubsidized loan. This is dependent on their remaining aggregate loan eligibility
If you are enrolled less than full-time, your annual loan limit will be prorated based on your enrollment intensity. This means the amount you can borrow in a given year will be proportional to the number of courses you are taking.
- If a borrower has a Federal Direct Loan disbursed before July 1, 2026, while currently enrolled in a credentialed program, the borrower can continue to borrow under current loan limits for three academic years or the remainder of their expected time to credential, whichever is reached first.
- Current Graduate students can finish out their current program under the old loan limits, as well as have access to Graduate PLUS loans until the end of their academic program, or three academic years, whichever is first.
- Current borrowers are defined as those who have borrowed at least one Graduate PLUS or Direct Unsubsidized loan prior to July 1, 2026, and who will remain in the same academic program after July 1, 2026.
- If you switch to a different academic program, even within the same institution, this can place you in a new borrowing category. This means your loan limits and eligibility could be recalculated as if you were a “new borrower,” even if you previously qualified as a “current borrower” under your former program.
- Federal guidance suggests that the definition of “professional degree programs” is being refined and applied within a more precise regulatory framework.
- Regulations indicate a narrower interpretation of what qualifies as a “professional degree,” including programs such as:
- Pharmacy (PharmD), Dentistry (DDS or DMD), Veterinary Medicine (DVD), Chiropractic (D.C. or DCM), Law (LLB or J.D.), Medicine (M.D.), Optometry (O.D.), Osteopathic Medicine (D.O.), Podiatry (DPM, D.P., or PodD), Theology (MDiv or MHL) and Clinical Psychology (PsyD or PhD).
**Fayetteville State University does not currently have any programs that are classified as a professional program. The designation of being a professional program is associated with a higher student loan limit.**
Beginning July 1, 2026, federal student loan repayment options will change for both student and parent borrowers. Additionally, important updates will take effect on July 1, 2028, including the sunset of certain income driven repayment plans. Below is a brief overview to help students, families, and borrowers understand what to expect based on the type and timing of their loans.
| Scenario | Available / Required Repayment Options |
|---|---|
| New loans disbursed on or after July 1, 2026 | Existing income‑driven plans IBR, PAYE, SAVE are eliminated and replaced with the Repayment Assistance Program (RAP). |
| Borrower has loans from before July 1, 2026, AND takes a new loan after July 1, 2026 | For the new loan, borrower is limited to RAP or the new Standard repayment plan (10–25 years). |
| RAP borrowers switching plans | Borrowers using RAP are not locked into a 30‑year plan; they may switch into a Standard plan (terms: 10, 15, 20, or 25 years). |
| Borrowers with no new loans on or after July 1, 2026 | May continue enrolling in current: Standard, Income‑Based Repayment (IBR), Graduated, Extended. They may also opt into RAP if desired. |
| Borrowers currently in ICR, PAYE, SAVE | Must transition to a new repayment plan by July 1, 2028. If no plan is selected, they will automatically be moved to RAP. |
Fayetteville State University is committed to offering academic programs that lead to strong career and financial outcomes for our students. New federal regulations introduce an Institutional Accountability framework that evaluates program performance based on student earnings after completion.
Accountability Requirements
Under these rules, a program may lose federal Direct Loan eligibility if it fails the federal Low Earnings Outcomes measure in two out of three consecutive years. These regulations replace the prior debt‑to‑earnings test and align reporting across Gainful Employment (GE) and Financial Value Transparency (FVT) standards.
Programs that fail the measure for more than two consecutive years may also face an administrative capability penalty.
How Programs Are Evaluated
- Undergraduate Programs-Compare the median earnings of graduates four years after completion to the earnings of working adults with only a high school diploma or GED.
- Graduate Programs-Compare the median earnings of students four years after enrollment to the earnings of working adults with only a bachelor’s degree.
These comparisons determine whether programs provide earnings above baseline wages for individuals with lower levels of education.
Student Notifications
If a program fails the Low Earnings Outcomes measure, the University must provide clear warnings to students regarding the program’s performance and potential financial risks.