One Big Beautiful Bill Act
The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, introduces significant changes to federal student aid programs and eligibility requirements. Many of these changes will take effect for aid disbursed on or after July 1, 2026, impacting students during the 2026-27 academic year.
This page highlights the key provisions to help you understand how these changes may affect your federal student aid eligibility beginning July 1, 2026 and beyond. We will update this information regularly as additional guidance becomes available. For the latest information, please visit Federal Student Aid.
Please note that the information provided on this page is subject to change as the U.S. Department of Education issues final regulations and implementation guidance.
Undergraduate Students
Federal pell grant
- Students who receive grants and scholarships from non-federal sources that fully covers their Cost of Attendance (COA) are not eligible to receive Federal Pell Grant, even if they meet Pell Grant eligibility requirements.
- Students who have a Student Aid Index (SAI), as calculated from the FAFSA, exceeds twice the maximum Pell Grant award amount. For 2026-27 award year, the maximum Pell Grant amount is $7,395. Therefore, SAI that exceeds 14,790 are ineligible.
Federal Direct Subsidized and Unsubsidized Loans
- The annual and aggregate loan limits and amounts remain unchanged from prior years.
- Institutions are required to prorate the annual loan amounts for students enrolled in less than full-time status. For undergraduate students, full-time enrollment is defined as 12 or more units. This proration requirement is known as Schedule of Reduction (SOR) and is applied to ensure loan amounts are adjusted in proportion to a student's enrollment.
- The federal loan program lifetime loan limit is $257,500 for all Federal Direct student loans (excluding Parent PLUS Loan) for all level of study.
Parent plus loan
The Federal Parent PLUS Loan is a federal loan available to parents of a dependent undergraduate student to help cover educational expenses. Beginning with the 2026-27 award year, the program includes the following borrowing limits:
- Parents (combined) may borrow up to $20,000 per academic year per dependent student.
- The aggregate borrowing limit per dependent student is $65,000.
Parents are not subject to the new PLUS Loan limits for up to three (3) academic years or the remainder of the student's expected time to credential (whichever is less) if:
- The student continuously enrolled in the same program of study at USF as of June 30, 2026, and
- The parent had a Parent PLUS Loan disbursed for that same program prior to July 1, 2026, or
- The student had a Direct Subsidized or Unsubsidized Loan disbursed for the same program prior to July 1, 2026.
The aggregate limit applies regardless of prior Parent PLUS Loan amounts that may have been forgiven, repaid, cancelled, or discharged. The expected time to credential for undergraduate students is four (4) years.
Graduate and Professional Students
Direct Unsubsidized loan
- The annual loan limits for graduate students is $20,500 and $50,000 for professional students.
- The aggregate loan limits is capped at $100,000 for graduate students and $200,000 for professional students. The aggregate loan limit does not include amounts borrowed as an undergraduate student.
- Professional students are students in the USF School of Law program.
- These changes to the annual and aggregate loan limits do not apply to students who qualifies under the legacy exceptions.
- Institutions are required to prorate the annual loan amounts for students enrolled in less than full-time status as defined by the program. This proration requirement is known as Schedule of Reduction (SOR) and is applied to ensure loan amounts are adjusted in proportion to a student's enrollment.
graduate plus loan
Under OBBBA, the Graduate PLUS Loan is eliminated and no longer available for graduate and professional students unless they qualify for the legacy exception.
Federal loan program lifetime limit
The new lifetime federal loan limit is $257,500 for all Federal Direct loans. This includes Direct Subsidized Loan, Direct Unsubsidized Loan, and Graduate PLUS Loan for all level of study. The lifetime loan limit excludes Parent PLUS loans.
Legacy Exception Qualifications
Students who qualifies for the legacy exception are not subject to the new loan limits and eligible to use the Graduate PLUS Loan for up to three (3) academic years or the remainder of their expected time to credential, whichever is less. At USF, most graduate programs expected time to credential is two (2) years. The 2 years also counts for students who enrolls in less than full-time status as a graduate or professional student and who may take longer than the expected time of completion for the program. These qualifications are:
- The student continuously enrolled in the same program of study at USF as they were enrolled in as of June 30, 2026, and
- Who had a Direct Loan (Federal Direct Unsubsidized Loan or Graduate PLUS Loan) disbursed for the same program prior to July 1, 2026.
Schedule of Reductions (SOR)
Students are required to enroll in full-time courses and remain in full-time status for the academic year to be eligible for the full annual loan limit. Students who enroll in less than full-time coursework or drop below full-time will receive a prorated or adjusted annual loan amount.
For example, a full-time undergraduate student is 24 units for fall and spring semester. If a student enrolls in 9 units in fall and 9 units for spring for a total of 18 units, the student will receive 75% of the annual loan amounts. The calculation is 18/24= 75%.
SOR applies to Direct Subsidized Loan, Direct Unsubsidized Loan, and Graduate PLUS Loan. Parent PLUS Loan is not subject to SOR and proration.