Federal student loan rules for graduate school borrowers are changing for the first time in nearly two decades, and the effects are causing a hard reckoning for current university business models.
The Trump administration is pressing colleges to cut student loan default rates ahead of new federal rules this summer. Advocates warn the guidance could shift blame to schools and hurt borrowers.
The report underscores growing problems in the student loan system, with many borrowers falling behind on payments. Nearly 10% of loan balances are more than 90 days past due.
More students are choosing community college and short-term credentials over four-year degrees as costs rise and job prospects soften. New federal student loan caps and expanded Pell eligibility starting in mid-2026 could speed up the “un-college” shift.
Students—including young cohorts—are favoring affordable programs that lead directly to career opportunities, and community colleges are answering the call.
The 2026 Best Online Programs rankings from U.S. News & World Report highlight online education as a key pathway for working adults, parents and military service members who need flexibility while earning a degree.
About 6 in 10 Kentucky undergraduate students now graduate debt free, according to a report from the Kentucky Council on Postsecondary Education. That’s up from 2019-20, when about 4 in 10 students graduated debt free.
Undergraduate certificate and associate degree enrollments each grew about 2% in fall 2025, while bachelor’s programs rose by less than 1%, according to the report. Community colleges now enroll 752,000 certificate students, up 28% from four years ago.
