Overview
- The One Big Beautiful Bill Act goes into effect on July 1, 2026, replacing most existing plans so new borrowers generally can use only the Repayment Assistance Plan (RAP) or a Tiered Standard Plan.
- Borrowers who take any new Direct Loan or a Direct Consolidation Loan first disbursed on or after July 1 will be treated as 'new' borrowers and can lose access to prior plans and protections across their federal loans.
- The law sets annual and lifetime caps for graduate, professional and Parent PLUS borrowing — examples include $20,500 per year and $100,000 total for many graduate programs and a $65,000 lifetime cap for Parent PLUS in many cases.
- Servicers will begin notifying roughly 7 million former SAVE enrollees around July 1 and those borrowers will have 90 days to choose a new plan before automatic placement on a standard option.
- States, borrower groups and legal teams are already challenging parts of the rollout over health‑care and professional degree caps and other limits, and experts urge borrowers to update contact info, check studentaid.gov, and avoid consolidating or taking new federal loans unless necessary.