One Big Beautiful Bill Act (OBBBA) Updates
The One Big Beautiful Bill Act (OBBBA) was signed into law on July 4, 2025 and includes several changes to federal student financial aid programs that are expected to take effect beginning July 1, 2026.
Many of these changes may affect how students and families borrow federal loans and how some students qualify for federal grants.
Mount Mary University is sharing the information below based on current federal guidance. The U.S. Department of Education is still working through implementation plans and final regulations, so some information may change. This page will continue to be updated as additional guidance becomes available.
For many current Mount Mary undergraduate students:
- Annual federal student loan limits are not changing
- Pell Grant eligibility rules are changing beginning in 2026–2027
- Students attending less than full-time may see changes to loan eligibility
Graduate students and families using Parent PLUS Loans may experience the largest changes:
- Graduate PLUS Loans will end for new students entering programs after July 1, 2026
- Parent PLUS Loans will have annual and lifetime borrowing limits
- New federal lifetime borrowing limits will apply
The chart below compares current federal annual borrowing limits to the limits expected under OBBBA.
For most Mount Mary undergraduate students, annual Direct Loan limits will remain unchanged.
| Borrower Type (Direct Loan Type) | Current / Grandfathered Limits | New Limits Effective July 1, 2026 |
| Undergraduate (Subsidized) | $3,500 (first-year) $4,500 (second-year) $5,500 (third-year and beyond) |
No changes |
| Undergraduate (Unsubsidized) | Dependent: $5,500–$7,500 minus subsidized loans Independent: $9,500–$12,500 minus subsidized loans |
No changes |
| Graduate Student (Unsubsidized) | $20,500 | $20,500 |
| Professional Student (Unsubsidized) | $20,500 | $50,000 |
| Graduate/Professional PLUS | Up to Cost of Attendance minus other aid | No new PLUS loans for students entering new programs |
| Parent PLUS | Up to Cost of Attendance minus other aid | $20,000 annually per dependent undergraduate student |
What this means for Mount Mary families: Families currently borrowing Parent PLUS loans to cover larger remaining balances may need to consider additional payment options or alternative financing strategies.
OBBBA establishes new aggregate and lifetime borrowing limits.
The aggregate loan limit is the total amount a student may borrow under specific federal loan programs while enrolled.
The lifetime loan limit is the total amount of federal Title IV loans a student may borrow through undergraduate, graduate, and professional enrollment.
The lifetime borrowing limit includes:
- Subsidized loans
- Unsubsidized loans
- Graduate PLUS loans
- FFEL loans
- Perkins loans
The lifetime limit does not include Parent PLUS loans.
Students who reach the lifetime limit will no longer be eligible for additional federal Title IV loans. Eligibility generally cannot be restored through repayment, loan forgiveness, discharge, or cancellation.
New Aggregate Loan Limits
| Borrower Type | Current / Grandfathered Limits | New Limits Effective July 1, 2026 |
| Undergraduate Subsidized | $23,000 | No changes |
| Undergraduate Unsubsidized | Dependent: $31,000 Independent: $57,500 |
No changes |
| Graduate Student | N/A | $100,000 |
| Graduate/Professional PLUS | No limit | No new PLUS loans |
| Parent PLUS | No limit | $65,000 per dependent student |
New Lifetime Loan Limits
| Loan Type | Current Limits | New Limits Effective July 1, 2026 |
| All Federal Loans excluding Parent PLUS | N/A | $257,500 |
Students beginning a new graduate or professional program on or after July 1, 2026 will no longer have access to Graduate PLUS loans unless they meet grandfathering requirements.
Students who meet both of the following requirements on June 30, 2026 may continue under current federal loan rules:
- Enrolled in the same program of study
- Received a Direct Loan for that same program before July 1, 2026
Students may lose grandfathered status if they:
- Withdraw from their program
- Transfer institutions
- Begin a new degree program
Once grandfathered status is lost, it cannot be restored.
Students will retain grandfathered status until:
- Completion of the degree at the same institution; or
- The end of the student's expected time to credential (up to three academic years or the program completion period, whichever is shorter); or
- The student withdraws or otherwise ceases enrollment.
Beginning with the 2026–2027 academic year, federal loan eligibility may be adjusted based on total enrollment. This change applies to all students, including current students.
Exact calculations are still being finalized by the Department of Education. The Department of Education has indicated that federal loans may be awarded based on total enrollment within an academic year, and changes in enrollment may affect eligibility.
Q: Can I opt out of being grandfathered under current loan rules?
A: No. Students cannot choose to opt out of grandfathering rules.
Q: If I lose grandfathered status, can I regain it later?
A: No. Once grandfathered status is lost, it cannot be restored.
Q: Can I transfer schools and keep grandfathered status?
A: No. Students must remain enrolled in the same program at the same institution to maintain grandfathered status.
Q: Can undergraduate students change majors and keep grandfathered status?
A: Please check with the financial aid office to confirm.
Q: I am a current Mount Mary graduate student. Will I automatically lose Graduate PLUS eligibility?
A: Not necessarily. Students who meet federal grandfathering requirements may continue under current loan rules.
Current students:
- Continue filing the FAFSA each year
- Monitor your Mount Mary email for updates
- Contact Financial Aid if you anticipate changes to enrollment
Graduate students:
- Contact Financial Aid if you expect to rely on Graduate PLUS Loans
Parents:
- Review Parent PLUS borrowing changes if you plan to borrow in future years
This webpage does not provide details regarding every proposed change within the OBBBA but focuses on the provisions which will most impact our students. Additional resources for information have been published by Federal Student Aid and professional associations. Please visit:
- Federal Student Aid
- National Association of Student Financial Aid Administrators (NASFAA)
- National Association of Independent Colleges and Universities (NAICU)
Questions?
Mount Mary University Financial Aid Office
Phone: (414) 930-3044
Email: mmu-finaid@mtmary.edu