U.S. — Changes to the federal student loan system under the One Big Beautiful Bill Act are scheduled to take effect on July 1, 2026. These changes impact repayment plans, borrowing limits, and loan forgiveness programs.

Beginning July 1, 2026, new Parent PLUS loans will have a cap of $20,000 per dependent undergraduate student per year. Additionally, the lifetime borrowing limit for new Parent PLUS loans will be set at $65,000 per student. Previously, parents could borrow an amount up to the full cost of attendance for Parent PLUS loans.

Betsy Mayotte, president of the Institute of Student Loan Advisors, commented on the potential effects of these borrowing limits. She stated, "That might mean having to go to private loans to finish paying for the degree. And if you can't qualify for a private loan, you might not be able to complete your degree, which has me very, very worried."

For students taking out federal loans after July 1, 2026, the Repayment Assistance Plan (RAP) will become the only income-driven repayment plan available. Parent PLUS borrowers are not eligible for the RAP. The SAVE repayment plan is being phased out under the new law.

New borrowers will also have the option of a standard repayment plan, which features fixed monthly payments. These plans can range from 10 to 25 years, depending on the amount borrowed. Mayotte said, "When in doubt," borrowers should visit StudentAid.gov to review the latest information and compare repayment options.