When President Donald Trump signed the ‘One Big Beautiful Bill Act‘ into law last month, it introduced hundreds of provisions, added an estimated $3 trillion to the national debt, and slashed trillions in tax revenue over the next decade. Some of these provisions include additional military spending, Medicaid cuts, increased border security spending, and changes to the Supplemental Nutrition Assistance program (SNAP). One of the more notable provisions made under this bill was the various changes made to student loans.
What is most important to note is that the majority of these changes will not go into effect until July 1st, 2026. For those who are currently enrolled, there are no changes to your federal loan options, as long as you complete your degree in the next three years.
The Bill also promised the elimination of Parent PLUS Loans, student loans that are taken out in the parent’s name, making the parent responsible for the payment rather than the student. If your parent plans to use a Parent PLUS Loan, parents can only borrow up to $20,000 a year, whereas previously they could borrow an unlimited amount up to their child’s total cost of attendance. If your parent already has a PLUS loan, they can continue borrowing under these old rules.
Graduate students can still get an unsubsidized loan on or after July 1st, 2026, but there are new limits to graduate and professional degrees. Graduate PLUS loans will no longer be available to graduate students.
To get a better understanding of how this will impact colleges and universities across the country, particularly Pace University, I spoke with Mark Stephens, the Assistant Vice President of Financial Aid. Stephens helped break down what students need to know and what actions they can take now in regards to this new bill.
To help prepare for the upcoming changes to student loans next year, Stephens recommends looking into Private Education Loans. These can help cover the Cost of Attendance, minus any aid you receive, as well as let you delay repayment after graduation. Pace has a list of private lenders that students have successfully used in the past. You can find this list here: Alternative Financing Options | Pace.
With this bill bringing big changes to student loans, there are some demographics that are affected more than others. Most notably, students in law and health professions who have relied on Graduate PLUS loans will feel the impact come July next year. Undergraduates with large outside scholarships might lose their access to Federal Pell Grants if their aid exceeds the cost of attendance. Students from families with higher or foreign income potentially qualify for less aid.
Stephens confirms that despite bracing for stricter rules regarding federal loans, there will be no changes to their budget.
“Pace is committed to helping students afford their education. We will continue to offer generous scholarships, grants, and alternative loan options. Pace is also reviewing its academic programs to make sure they remain eligible under new federal rules, which tie loan access to job outcomes after graduation.”
Even though these changes go into effect next July, Stephens says Pace is already preparing for that timeline. They have already started updating communications and financial aid info, training staff, reviewing student outcomes and loan data, and continuing to stay on top of guidance from the Department of Education.
Stephens also encourages students and parents to plan early as well, as they prepare for more limited loan options – especially if they are counting on Parent PLUS or Graduate PLUS loans.
“Pace will continue to support you through the transition with financial aid, payment plans, and trusted private loan options.”