Federal Updates
Financial aid impact under federal legislation: One Big Beautiful Bill Act
This information reflects the most current guidance available for the One Big Beautiful Bill Act and is subject to change.
The One Big Beautiful Bill Act (OB3 or OBBBA) was enacted into law on July 4, 2025, through the federal budget reconciliation process. This legislation contains major changes that significantly reshape federal student aid across the country.
What changed under the One Big Beautiful Bill Act?
Federal Pell Grant Eligibility Changes
The following Pell changes take effect beginning July 1, 2026:
- Students meeting or exceeding their full Cost of Attendance with scholarship/waiver aid will not be eligible for any amount of Pell Grant.
- This change will affect student-athletes on full-ride scholarships, as well as other students whose institutional, state, and/or private aid meet or exceed full COA.
- This is a change from previous regulations, which allowed students in some circumstances to be fully funded with scholarship aid and still received their Federal Pell Grant on top.
- Students with an SAI equal to or greater than 14,790 (twice the maximum Pell Grant which is $7,395) are ineligible to receive a Pell Grant.
- Certain Assets Excluded: Family businesses (≤100 employees), family farms, and commercial fishing operation assets will be excluded in SAI calculation.
- Foreign Income Included: Income from foreign sources will be added to adjusted gross income (AGI).
- Click here for more information regarding the Pell Grant.
Federal Loan Program Changes
Schedule of Reduction for Loans: Beginning the 2026-2027 academic year, all unsubsidized and subsidized annual loan amounts will be reduced based on enrollment status for those enrolled less than full time. Borrowers enrolled in less than full time will only be able to borrow loan amounts in direct proportion to their credit load, with a minimum half-time enrollment requirement.
Changes to the following Federal Student Loan Programs will be effective July 1, 2026:
- Graduate PLUS Loan Program eliminated
- Parent PLUS annual and loan limits
- Graduate/Professional annual and aggregate loan limits
- Federal Loan Program lifetime limits
- Loan Reduction for students below full-time
Overview based on Student Type
This information below provides an overview of key changes and explains the impact to students and families by student type.
- Incoming Fall 2026 freshmen and transfer students will fall completely under the new federal policy.
- Loans: Incoming and transfer students will adhere to the new Federal Direct Loan limits as shown in the table below.
- Lifetime limits listed below exclude Parent PLUS.
| Year in School | Dependent Students | Independent Students |
| First-Year Undergraduate Annual Loan Limit: |
$5,500 No more than $3,500 of this amount may be in subsidized loans |
$9,500 No more than $3,500 of this amount may be in subsidized loans |
| Second-Year Undergraduate Annual Loan Limit: |
$6,500 No more than $4,500 of this amount may be in subsidized loans |
$10,500 No more than $4,500 of this amount may be in subsidized loans |
| Third-Year and Beyond Undergraduate Annual Loan Limit: |
$7,500 No more than $5,500 of this amount may be in subsidized loans |
$12,500 No more than $5,500 of this amount may be in subsidized loans |
Aggregate and Lifetime Loan Limits
| Loan Limits | Dependent Students | Independent Students |
| Subsidized and Unsubsidized Aggregate Loan Limit: | $31,000 No more than $23,000 of this amount may be in subsidized loans |
$57,500 No more than $23,000 of this amount may be in subsidized loans |
| Lifetime Loan Limit: | $257,500 | $257,500 |
Parent PLUS Loans: will be subject to new annual and aggregate borrowing limits per dependent student. These limits apply regardless of prior loan forgiveness, repayment, cancellation, or discharge.
- Parents (combined) may borrow:
- $20,000 per year per dependent student
- $65,000 aggregate limit per dependent student
Schedule of Reduction for Loans: Beginning the 2026-2027 academic year, all unsubsidized and subsidized annual loan amounts will be reduced based on enrollment status for those enrolled less than full time. Borrowers enrolled in less than full time will only be able to borrow loan amounts in direct proportion to their credit load, with a minimum half-time enrollment requirement.
What’s Changing:
Schedule of Reduction for Loans: Beginning the 2026-2027 academic year, all unsubsidized and subsidized annual loan amounts will be reduced based on enrollment status for those enrolled less than full time. Borrowers enrolled in less than full time will only be able to borrow loan amounts in direct proportion to their credit load, with a minimum half-time enrollment requirement.
Parent PLUS Loans: New Borrowers will be subject to new annual and aggregate borrowing limits per dependent student. These limits apply regardless of prior loan forgiveness, repayment, cancellation, or discharge.
- Parents (combined) may borrow:
- $20,000 per year per dependent student
- $65,000 aggregate limit per dependent student
Legacy Provision for Active Parent Plus Loan Borrowers: If the student or parent borrower received a Federal Direct Loan before July 1, 2026, while the dependent student was enrolled in a program of study, Parent PLUS borrowing may continue under current loan limits for up to three academic years or the remainder of the student’s expected time to credential, whichever is less.
What’s Staying the Same:
Many students currently enrolled as of Spring and Summer 2026, who have previously borrowed federal direct loans under their current program will fall under the legacy provisions.
- Legacy Provisions: Allows current students or parents to temporarily continue to borrow under the prior federal loan rules and loan limits for 3 academic years or the remainder of their expected time to credential, whichever is less.
- Annual: $5,500-$12,500 (based on year and dependency status)
- Total: $31,000 (dependent) or $57,500 (independent)
- U.S. Department of Education: Loan Amount Limits
Legacy Provisions Qualifications:
- A Federal Direct Loan is disbursed on or before June 30, 2026.
- Undergraduates may change majors if they remain at the undergraduate level.
- There is no withdrawal or break in enrollment.
- If you do not qualify for the legacy provisions, please see the Incoming Freshmen/Transfer Undergraduate Students section for more information about the changes to federal financial aid.
You are starting a graduate program in the Fall of 2026 or later.
Incoming Fall 2026 graduate degree students will fall under the new policy:
- The Graduate PLUS loan is no longer available.
- The new loan limit is $20,500 annually with a program limit of $100,000. The program limit does not include undergraduate loans. The lifetime federal loan limit is $257,500 which does not include undergraduate Parent PLUS loans.
| Program Type | Annual Limit | Aggregate Limit | Lifetime Maximum |
| Graduate: | $20,500 | $100,000 | $257,500 (all undergrad, grad, and professional) |
Schedule of Reduction for Loans: Beginning the 2026-2027 academic year, all unsubsidized annual loan amounts will be reduced based on enrollment status for those enrolled less than full time. Borrowers enrolled in less than full time will only be able to borrow loan amounts in direct proportion to their credit load, with a minimum half-time enrollment requirement.
What’s Changing:
Current Graduate Students will follow the New Annual, Aggregate, and Lifetime Toal Loan Limits
- The new loan limit is $20,500 annually with a program limit of $100,000. The program limit does not include undergraduate loans. The lifetime federal loan limit is $257,500 which includes the Graduate Plus Loan but not undergraduate Parent PLUS loans.
| Program Type | Annual Limit | Aggregate Limit | Lifetime Maximum |
| Graduate: | $20,500 | $100,000 | $257,500 (all undergrad, grad, and professional) |
Graduate PLUS loans are no longer available starting July 1, 2026.
You may continue borrowing Graduate PLUS loans under prior limits for up to 3 academic years (or the remainder of your academic program, whichever is less) if you meet the criteria below:
- Are enrolled as of June 30, 2026, and
- Previously borrowed a federal loan for your academic program, and
- Remain in the same academic program through graduation
Schedule of Reduction for Loans: Beginning the 2026-2027 academic year, all unsubsidized annual loan amounts will be reduced based on enrollment status for those enrolled less than full time. Borrowers enrolled in less than full time will only be able to borrow loan amounts in direct proportion to their credit load, with a minimum half-time enrollment requirement.
What’s Staying the Same:
Many Graduate students currently enrolled as of Spring and Summer 2026, who have previously borrowed federal direct loans under their current program will fall under the legacy provisions.
- Legacy Provisions: Allows for continuing students to temporarily continue to borrow under the prior federal loan rules. Students who qualify for legacy provisions may continue using Graduate PLUS loans and the prior federal loan limits. The student can continue to borrow under the current loan limits for 3 academic years or the remainder of their expected time to credential, whichever is less. Legacy eligibility is determined by federal law and is automatically applied if a student qualifies. It cannot be waived or declined.
- Legacy Provision Qualifications:
- A Federal Direct Loan is disbursed on or before June 30, 2026.
- The student must remain in the same program at the same school.
- There is no withdrawal or break in enrollment.
Frequently asked questions
Learn more about common questions regarding the One Beautiful Bill Act.
No, effective July 1, 2026, Students who receive grants or scholarships from non-federal sources covering their entire cost of attendance (COA) are ineligible to receive a Pell Grant, even if otherwise eligible for the program.
No, students who meet the legacy provisions may not forfeit their legacy borrower status and must continue to borrow under the current loan regulations prior to OB3.
Federal Unsubsidized Loan: For those students who can complete the FAFSA, students will be able to receive a Federal Unsubsidized Loan to help cover the costs of their education.
Private Educational Loans: These are offered by private lenders, banks, and credit unions. The terms can vary depending on the lender and normally require a credit check. It is important to compare interest rates, repayment terms, and borrower protection policies offered by each lender.
Federal full-time status is 12 credits per semester for undergraduate students and 9 credits per semester for graduate students.
Most changes take effect starting July 1, 2026. That includes new loan limits, the phase-out of Grad PLUS, and changes to Pell Grant eligibility.
No, federal loan and aid changes under the new law will not affect your scholarships. Scholarships are awarded and renewed based on university policies and program criteria.
The new law does not change the annual or aggregate loan limits for undergraduate students, although undergraduate loans will now count towards the new lifetime limit.
Yes, but starting July 1,2026 new limits apply:
Parents will be capped at $20,000 per year and $65,000 lifetime in PLUS borrowing per student. If both parents borrow on behalf of the same student, their combined borrowing is capped at $20,000 per year and $65,000 lifetime.
If you borrowed Parent PLUS Loans prior to July 1, 2026, you are eligible to borrow under the previous loan limits for the remainder of your student’s program or three years, whichever is shorter. The student must remain continuously enrolled in their current program. If the student takes a leave of absence or doesn’t complete a term, they will be considered a new borrower and subject to the new limits.
If you’re currently enrolled and participating in the student and/or parent Federal loan programs at UT San Antonio, there are no changes to the aid you’ve already received.
If you borrowed a federal student loan at UT San Antonio for a term that began before July 1, 2026, you remain eligible to borrow under the previous loan limits for the duration of your current program or for three years (whichever is shorter), including Graduate PLUS loans.
If your parent borrowed a Parent PLUS loan at UT San Antonio for a term that began before July 1, 2026, your parent remains eligible to borrow under the previous loan limits for the duration of your current program or for three years (whichever is shorter).
Grad PLUS Loans are being phased out under the new law.
New graduate students will no longer be eligible to borrow Grad PLUS for terms that begin on or after July 1, 2026.
If you’re already borrowing Direct Loans before July 1, 2026, you may continue to borrow Graduate Plus Loans. To be eligible, you must be continuously enrolled in your current program of study.
To qualify under the legacy provision rules built into OBBB, a student and/or parent must be a federal direct loan borrower of a loan that was disbursed before July 1, 2026.
Yes, if you change your graduate program on or after July 1, 2026, you will likely lose your legacy provision status. Keeping your Legacy Status after July 1, 2026 is explicitly tied to you being continuously enrolled in the same program of study at the same institution.
Not enrolling in summer courses is not considered a break in enrollment for OB3, as long as the student is enrolled for the preceding Spring term and the following Fall term.
To be eligible for the previous loan limits (including Grad PLUS), you must be continuously enrolled in your current program of study. If you take a leave of absence or go on academic pause, you will be considered a new borrower subject to the new loan limits. You will also be considered a new borrower if you temporarily stop attending your current program of study to enroll in and/or complete another program.
Starting in the 2026–27 academic year, new federal loan limits will apply to graduate students.
Graduate students will be limited to the new loan limit of $20,500 annually with a program limit of $100,000. The program limit does not include undergraduate loans. The lifetime federal loan limit is $257,500 which includes those who have borrowed a Graduate Plus loan, but this does not include undergraduate Parent PLUS loans.
It’s important to explore other funding options early. These may include:
- Internal and External Scholarships via the Scholarship Hub
- Installment Plans
- Alternative Loan Options
If you expect to need more funding than the new federal loan limits allow, contact One Stop to discuss options that may fit your program and timeline.
Federal Unsubsidized Loan: For those students who can complete the FAFSA, students will be able to receive a Federal Unsubsidized Loan to help cover the costs of their education.
State & Private Educational Loans: These are offered by private lenders, banks, and credit unions. The Texas Higher Education Coordinating Board also offers low-interest loans for students who are Texas residents. The terms can vary depending on the lender and normally require a credit check. It is important to compare interest rates, repayment terms, and borrower protection policies offered by each lender. Click here for more information regarding additional State & Private Loan options.