Starting next July, graduate students will encounter stricter federal borrowing limits that could reshape how Americans finance advanced degrees.
Most graduate programs will be capped at $100,000 in federal loans, while only what the Department of Education categorizes as "professional" degrees: medicine, dentistry, and law, will qualify for $200,000 limits. The changes take effect July 1, 2026.
"I think that's gonna really hurt the talent in our city. We wanna be able to offer good paying jobs but also to get those jobs, people are looking for higher education and so those seats will go unfilled if people are unable to financially find a way to go back to school that works for them," Talia McGill said.
McGill got her undergraduate degree through scholarships, but had to take out loans for her master's program. Like many graduate students, she couldn't find other financial support for her advanced degree.
McGill has been making payments since graduating in 2016. As a nonprofit employee, she has been working toward Public Service Loan Forgiveness, but said frequent transfers between loan servicers have complicated the process.
"They're transferring loans to different places all the time so who I initially had my loan with in the beginning is not who's servicing it now and every time that happens you almost have to start the process over again," McGill said.
Under the One Big Beautiful Bill Act that was signed into law in July, popular income-driven repayment plans like SAVE and PAYE will be eliminated by 2028. Borrowers will be moved to either a new Repayment Assistance Plan or a standard fixed payment plan.
McGill worries the simplified system will hurt borrowers who need flexibility.
"I think people are gonna struggle. They will choose basic necessities over repaying their student loans," McGill said.
Parent PLUS borrowers have until June 30, 2026 to consolidate their loans to access better repayment options. The repayment plan overhaul will be completed by 2028.
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