Significant changes to federal student loans were recently enacted through the One Big Beautiful Bill Act. These changes will affect how graduate and professional students finance their education beginning on July 1, 2026.
Changes to Terms and conditions of loans
Elimination of Direct Graduate PLUS Loan Program
Beginning July 1, 2026, the Federal Direct Graduate PLUS Loan program will be discontinued for new borrowers starting in the 2026-2027 academic year.
New Annual and Aggregate Loan Limits for New Borrowers beginning 2026-2027
Students who have not received a Direct Unsubsidized Loan disbursement from UCSF in the 2025-2026 academic year (“new borrowers”), will be subject to the following new Direct Unsubsidized Loan annual and aggregate (lifetime) limits:
- Graduate: $20,500 annual; $100,000 aggregate
- Professional (Dentistry, Medicine and Pharmacy): $50,000 annual; $200,000 aggregate
- Combined graduate + professional borrowing: capped at $200,000
- A separate lifetime limit of $257,500 applies to all federal student loans (excluding Parent PLUS loans borrowed on your behalf)
- Note: Direct Graduate PLUS Loans will NOT be available to new borrowers in 2026-2027.
Legacy Provision
Students who have a Direct Loan disbursed in the 2025-2026 academic year and continue to be enrolled at UCSF in the same program may continue borrowing legacy loan amounts in Direct Unsubsidized Loan and Direct Graduate PLUS Loans up to the full cost of attendance through the end of the 2028-2029 academic year or until the end of their program, whichever comes first.
Proration of Loans Based on Full-Time or Part-Time Enrollment
Beginning in the 2026-2027 academic year, new borrowers enrolled less than full-time will only be able to borrow an amount proportional to their enrollment status. Full-time is defined by the Satisfactory Academic Progress determined by the program or School.
Changes to Loan Repayment
Public Service Loan Forgiveness, or PSLF
No changes to PSLF provisions, although new limitations on eligibility have been proposed separately from the OBBB in other regulatory action.
New repayment plans
- For new loans disbursed in the 2026-2027 academic year, the bill eliminates current income-driven repayment plans (IBR, PAYE, SAVE) and replaces them with a new Repayment Assistance Program, or RAP.
- Students who have borrowed loans before July 1, 2026, and will borrow a new loan after July 1, 2026, are limited to the new RAP or the standard plans for the new loan.
- RAP borrowers will not be locked into a 30-year plan. They can switch to a standard plan, which ranges from 10 to 25 years.
- Borrowers with no new loans made on or after July 1, 2026, can continue to be eligible to enroll in the current Standard, current Income Based, or IBR, Graduated, and Extended repayment plans, and could also opt in to the new RAP. Current borrowers enrolled in ICR, PAYE, or SAVE plans must transition to a new repayment plan by July 1, 2028. If no selection is made by that date, they will be moved into RAP.
- More information on the new RAP is forthcoming.
Additional Resources
For additional resource, please visit:
- New Federal Direct Loan Terms and Conditions
- Federal Student Loan Program Provisions Effective Upon Enactment Under the One Big Beautiful Bill Act
- University of California Federal updates webpage
How to Prepare
- Check your loan history: To view your current total loan balance, log in to StudentAid.gov
- Understand your status: Determine if you qualify for the Legacy Provision. If you are currently enrolled at UCSF and have borrowed federal loans, you generally will.
- Prepare for any gaps in aid: If you anticipate your costs will exceed the new federal limits, begin researching private student loan options or preparing personal savings.
Private Loan FAQs
- How do I choose a lender or who do I choose?The University of California Office of the President (UCOP) compiles comprehensive Private Student Loans Lists that contain loan terms and interest rates as well as lender contact information as a place to get started. See the UCOP Preferred Private Lender List. You can also choose any lender that is not on the list. The Student Financial Services Office will certify a private loan from any ender of your choice.
- What are the best practices for applying for a Private Loan?Do research on what lenders are out there and their publicized terms – checking interest rates (variable vs. fixed), origination fees and repayment requirements. Check for pre-payment penalties. All terms are contingent on your credit.
- When do I need to apply?You can start applying for a private loan with the lender of your choice within 30 days before school begins. If you want to apply for a loan with multiple lenders, submit all the applications within the same 30-day period for minimal impact on credit.
- How do I maintain good credit?It is important to build good credit and maintain your credit score by monitoring your credit score, paying on time, and minimizing debt as much as possible. Find out more about credit on our website’s Understanding Credit page.
- How much can I request or how much should I request?The Student Financial Services Office will certify loan amounts based on the cost of attendance of your program. We suggest waiting for your award letter to know how much to request.
- How will private loans be disbursed?The Student Financial Services Office disburses private loans directly to students in the same manner that we disburse federal loans. Students will use Nelnet to make a refund preference and track disbursements.
- How often do I need to apply for a private loan?This will depend on the lender. Typically, students will apply yearly. Some lenders may offer multi-year approvals.
- Do I need a co-signer?Lenders may offer the option to apply for a private loan with a co-signer if needed or if your initial application is denied.
- What if I get denied?
You can request the adverse credit notice from the lender which will explain why you were denied. From there you can review or compare it to your credit report and contact the lender to see what available options you have to dispute errors, apply for a lower amount or apply with a co-signer.
REMINDER: If you have a Credit Freeze at one or more of the credit bureaus, you’ll need to lift it to apply for a loan:
- Lift your credit freeze with Equifax.
- Lift your credit freeze with Transunion.
- Lift your credit freeze with Experian.
- Start or continue application with private lender.