Financial Aid changes for 2026-27
One Big Beautiful Bill Act
The "One Big Beautiful Bill Act" (OB3), also referred to as the Working Families Tax Cuts Act contains several reforms to federal financial aid programs. Key changes include prorated loan limits based on enrollment, new caps on Parent PLUS loans, and changes to Pell eligibility calculations.
Changes to Annual Loan Limits: All unsubsidized and subsidized annual loan amounts will be reduced based on enrollment status for the academic year. Borrowers are still required to be at least half time, but anyone enrolled in less than full time will only be able to borrow loan amounts in direct proportion to their credit load. Dropping classes may result in a reduced disbursement based on a Schedule of Reductions (SOR) calculation.
Parent PLUS Loan Caps: Parent PLUS loans are limited to $20,000 per dependent undergraduate student per academic year, with a lifetime aggregate limit of $65,000 per student.
Pell Grant Changes: Certain assets will now be excluded in the SAI calculation: Family businesses (≤100 employees), family farms, and commercial fishing operation assets. Foreign Income will now be included in the adjusted gross income (AGI). Students whose institutional scholarships, waivers, or state aid meet or exceed their full Cost of Attendance (COA) will no longer be eligible to receive a Federal Pell Grant. Students with a SAI of 14791 or higher will not be eligible.
"Legacy" Protections: If you are a currently enrolled student who received a federal loan disbursement prior to July 1, 2026, you may be eligible to continue under pre-OB3 limits for three academic years or the remainder of their expected time to credential, whichever is less as long as you stay at the same credential level.
Changes to Loan Repayment Plans: Two new repayment options are being introduce: Repayment Assistance Plan (RAP) and the Tiered Standard Plan. Starting July 1, 2026, new borrowers will only have these two choices, while existing repayment plans (including SAVE, PAYE, and ICR) are being phased out. If you have existing student loans, you can reach out to your loan servicer for more information.
Federal Student Aid (FSA) has released helpful information for students on all the changes to federal financial aid programs included in the One Big Beautiful Bill Act.
The U.S. Department of Education has not yet published final regulations to implement these changes. As a result, some questions remain unanswered—both at the federal level and within financial aid offices.
What if I have more questions?
Stop by our office, call us at 903.463.8794, or email us at financialaid@grayson.edu.