Higher education institutions may limit the federal student loans that college students can take out next year, if they deem the student’s major more likely to default once they finish school.
In the ‘One Big Beautiful Bill,’ Congress implemented stricter student loan limits starting July 1, 2026. One of them allows financial aid administrators at colleges to limit the amount of loans offered to students and their parents in chosen degree programs, “as long as any such limit is applied consistently to all students enrolled in such program of study.”
Even before the bill, schools had the ability to limit federal student loans to a figure lower than the existing federal guidelines. Colleges typically restrict loans based on the student’s cost of attendance and the amount of other financial aid they received.2 The ‘One Big Beautiful Bill’ largely broadens schools’ ability to limit loans.
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