One Big Beautiful Bill Act: Title IV Federal Student Aid Changes
Federal Student Aid Statutory Changes Under the One Big Beautiful Bill Act
The One Big Beautiful Bill Act (OBBBA), signed into law July 4, 2025, amends TitleIV of the Higher Education Act of 1965 and establishes significant changes to federal student aid eligibility, borrowing limits, and repayment options, effective July 1, 2026. The provisions summarized below reflect current statutory requirements. Where the U.S. Department of Education has not yet issued final implementing regulations or subregulatory guidance, this page will be updated accordingly. Students are encouraged to contact the Office of Financial Aid directly with questions about how these changes affect their individual aid eligibility.
Borrowing Limits
The OBBBA establishes a revised statutory schedule of annual and lifetime aggregate borrowing limits, which vary by degree level and borrower type. These limits represent the maximum permitted under federal law; actual eligibility may be lower based on enrollment intensity, cost of attendance, and other aid received.
Graduate and Professional Studies
The Federal Grad PLUS Loan program is discontinued for new borrowers effective July 1, 2026. This is a statutory change under the OBBBA and is not subject to institutional discretion. In its place, the following annual and lifetime aggregate caps apply:
- Most graduate students (MA, MS, PhD, and similar): $20,500/year; $100,000 lifetime
- Professional degree students (medicine, law, dentistry, pharmacy, and similar): $50,000/year; $200,000 lifetime
Parent PLUS Borrowers
- $20,000/year; $65,000 lifetime per dependent student
Overall Federal Loan Ceiling
- A $257,500 lifetime aggregate limit applies to all federal loans ever borrowed, including amounts previously repaid, forgiven, or discharged
Undergraduate Direct Loans
Annual undergraduate Direct Loan limits are unchanged under the OBBBA.
Contact Us
Vanguard University
Attn: Financial Aid
55 Fair Drive
Costa Mesa, CA 92626
24/7 access to student financial aid: Financial Aid Self-Service
Location
Scott Academic Center, 1st floor
T: 714.966.5490
F: 714.619.6655
E: financialaid@vanguard.edu
Office Hours
Monday-Friday: 8am-5pm
FAFSA School Code: 001293
Federal Loan Repayment Options
The OBBBA discontinues three existing income-driven repayment plans (Income-Contingent Repayment [ICR], Pay As You Earn [PAYE], and the SAVEPlan) for new enrollment. Borrowers currently enrolled in these plans are required by statute to transition to an eligible repayment plan no later than June 30, 2028. Borrowers who do not affirmatively select a qualifying plan prior to that date will be administratively reassigned.
Going forward, borrowers will have two repayment options:
- Standard Repayment Plan: Fixed monthly payments over a term determined by total amount borrowed
- Repayment Assistance Plan (RAP): Income-based payments of 1–10% of income, with a statutory loan forgiveness provision after 30 years
Vanguard University does not administer federal loan repayment plans. Borrowers should contact their federal loan servicer for plan-specific guidance, or visitstudentaid.gov.
Legacy Borrower Provision
Students who were enrolled and received a federal Direct Loan disbursement prior to July 1, 2026, in their current program at their current institution, may qualify for legacy protection, meaning they may continue borrowing under prior-law limits for up to three additional academic years, or through program completion, whichever occurs first.
Important Condition
Legacy protection is forfeited upon withdrawal, leave of absence, or change of program. Students should consult with the Office of Financial Aid before making any enrollment changes if they wish to preserve legacy borrower status.
Grad PLUS Legacy Provision
Students with a Grad PLUS Loan disbursement prior to July 1, 2026, may continue borrowing under existing Grad PLUS terms for up to three additional academic years, or through program completion, whichever occurs first.
Pell Grants
Federal Pell Grant funding is not reduced under the OBBBA; however, certain eligibility criteria have changed. The following students will no longer qualify for Pell Grant awards effective July 1, 2026:
- Students with a Student Aid Index (SAI) of $14,790 or above
- Students whose full cost of attendance is already covered by non-federal grants or scholarships
Before Vs. After July 1, 2026
| Before | Loan Type | After |
|---|---|---|
| Graduate and professional students may only borrow up to $20,500 annually in unsubsidized Direct Loans | Direct Unsubsidized Loans | Graduate students may borrow up to $20,500 annually, $100,000 in aggregate. Professional students may borrow up to $50,000 annually, $200,000 in aggregate |
| Students may borrow up to the cost of attendance minus other financial assistance | Grad PLUS | Grad PLUS is phased out for some prior borrowers, and discontinued for new borrowers |
| Parents may borrow up to the COA minus other financial aid (per dependent) | Parent PLUS | Parents may borrow $20,000 annually or $65,000 in aggregate (per dependent) |
| $138,500 in subsidized and unsubsidized loans (including undergraduate loans) | Lifetime Aggregate Limit | $257,500 in Title IV loans (except Parent PLUS) without regard to amounts repaid, forgiven, canceled or otherwise discharged |
| Not explicitlyrequired by statute | Enrollment-Based Proration | Annual Direct Loan eligibility must be prorated for studentsenrolled less than full-time, based on enrollment intensity |
| Only on a case-by-case basis with documented justification | Institutionally-Determined Limit | Institutions may limit borrowing for a program of study if the limit is applied consistently to all students in that program |
Notice Regarding Pending Federal Guidance
Several provisions of the OBBBA remain subject to implementing regulations and subregulatory guidance from the U.S. Department of Education. The information on this page reflects current statutory requirements and available guidance as of June 25, 2026. Vanguard University's Office of Financial Aid will update this page as additional federal guidance is issued. Students and families should not rely solely on this page for borrowing decisions and are encouraged to contact our office directly.
For More Information
For full federal guidance, and the most up-to-date information, read “One Big Beautiful Bill Act Updates” on studentaid.gov.