Overview
- The Department of Education completed rulemaking under the One Big Beautiful Bill Act, ending Grad PLUS, capping Parent PLUS, and consolidating repayment into a single Repayment Assistance Plan starting in July 2026.
- New borrowing limits set $20,500 per year for graduate students with a $100,000 lifetime cap and $50,000 per year for professional students with a $200,000 aggregate cap.
- Revised Public Service Loan Forgiveness rules will exclude employers determined to have a “substantial illegal purpose,” with the Education Secretary empowered to weigh court judgments, settlements, or other evidence.
- Employers may regain PSLF eligibility after corrective actions or ten years, and borrowers’ qualifying payments made before July 1, 2026 remain protected.
- Boston and Chicago joined major labor unions in a federal lawsuit challenging the PSLF changes, which affect a student-debt system with roughly 42 million borrowers and an estimated 9 million potentially eligible for PSLF in 2022.