Overview of H.R.1 Bill, 119th Congress (2025–2026) AKA “One Big Beautiful Bill Act”
On July 4, 2025, President Donald Trump signed the H.R.1 bill (One Big Beautiful Bill Act) into law. Significant provisions in the bill that affect college students took effect on July 1, 2026. You can refer to this page for information and ongoing updates about how the bill may affect your financial aid, as well as factors to consider when navigating these changes.
Please also read our dedicated updates with additional details based on your academic level:
You are also welcome to download the following fact-sheets developed by the University of California Office of the President (UCOP):
- Fall 2026 Federal Financial Changes – student summary (PDF)
- Fall 2026 Federal Financial Changes – administrator summary (PDF)
Summary of key impacts
On this page, you’ll find key impacts of the law on financial aid.* These provisions are effective July 1, 2026. You can find the full analysis of the H.R.1 bill on the National Association of Student Financial Aid Administrators (NASFAA) news page.
Key areas of changes:
- Enrollment level impacts
- New federal loan limits and borrowing caps
- Federal loan repayment plans under H.R.1
*Note on impacts on Student Aid Index (SAI): Cuts and restrictions in H.R. 1, although not directly related to financial aid, may reduce a family’s total resources. This in turn may change the calculation of their Student Aid Index (SAI) and thus affect their aid eligibility.
Enrollment level impacts
Beginning with the 2026–2027 academic year, annual federal student loan amounts will be determined by a student’s level of enrollment (the number of units you complete). This policy is referred to as the Schedule of Reduction for Loans.
Schedule of Reduction for Loans (SOR): For all students (graduate and undergraduate), annual federal student loan amounts will be based on your unit load for the entire academic year. All federal loans for student borrowers will be prorated for students enrolled less than full-time; Parent PLUS loan amounts are not affected by the SOR.
How is enrollment level determined? Your level of enrollment is based on your units for the entire academic year. For UC Berkeley, your annual unit load is determined by fall and spring semester enrollment.
What is considered full-time enrollment under the new law? Full-time enrollment for financial aid purposes is defined for most students as 24 units during the academic year, or 12 units per semester. This varies by program for some graduate programs.
How do enrollment limits impact students enrolled part-time? For student borrowers who are enrolled less than full time, your federal student loan amounts will be reduced, and you will only be able to borrow loan amounts in direct proportion to your unit load. The process that determines how much you can borrow if you are enrolled less than full time is called loan proration.
What is the minimum enrollment level for federal student loans? To qualify for prorated federal student loans, there is a minimum half-time enrollment requirement, which for most students is 6 units per semester.
What about summer enrollment? Enrolling in classes the summer following an academic year can also count to meet the 24-unit full-time requirement.
How are Pell Grants affected by SOR? Information about changes based on enrollment for Pell Grants is covered on the Undergraduate Students: Federal Updates page. Graduate students are not eligible for Pell Grants.
I’m at risk of loan proration, what do I do?
For students who are at-risk of loan proration due to less than full time-enrollment, please reference our resources on navigating enrollment impacts.
How to navigate enrollment impacts
New federal loan limits and borrowing caps
What are the new limits for student loans under H.R.1?
There is a new lifetime borrowing cap for all students, a new loan limit for Parent PLUS loans, and new limits for graduate and professional student loans, as summarized below.
New lifetime borrowing cap on all federal student loans: The law contains a $257,500 lifetime borrowing cap on all federal student loans for all student borrowers, excluding Parent PLUS loan amounts.
Parent PLUS loan limit: New Parent PLUS loan borrowers will be subject to new loan limits: a $20,000 per year cap per dependent student and a $65,000 aggregate limit per dependent student, without regard to amounts forgiven, repaid, canceled, or discharged. These new annual and aggregate caps on Parent PLUS loans will limit the amount of federal loans that qualifying parents can take out to help pay for their child’s education.
Graduate loan limits: The law caps the annual graduate loan limits at $20,500 for graduate students and $50,000 for professional students. The aggregate limit is capped at $100,000 for graduate students and $200,000 for professional students. The law also eliminates the Graduate PLUS program for new borrowers. For detailed information, visit Graduate and Professional School Students: Federal Updates.
Note: The H.R.1 Bill does not include any changes to undergraduate federal student loan limits and maintains the current annual and aggregate borrowing limits for undergraduates. For a list of current loan limits, read Federal Student Aid Loan Limits.
What is the difference between the types of loan limits?
To understand changes to borrowing caps and loan limits under the H.R.1 Bill, please note the following loan definitions from the Office of Federal Student Aid:
- Annual loan limit: The maximum loan amount you can borrow each academic year.
- Aggregate loan limit: The maximum amount of unpaid principal balance minus any capitalized interest that you can have outstanding at any point in time on all of your subsidized and unsubsidized loans for undergraduate, graduate, or professional study.
- Lifetime maximum loan limit: The maximum amount you can receive, regardless of any amount paid or discharged, in any combination of subsidized loans, unsubsidized loans, and PLUS loans for graduate or professional study.
The annual and aggregate limits vary depending on your program of study and, for undergraduate students, how far along you are in your program and whether you’re a dependent or an independent student.
What are the legacy provisions for loan limits?
New H.R.1 Bill loan limits took effect on July 1, 2026, with a legacy provision included for borrowers who borrowed under previous limits for the remainder of their program of study. Legacy student borrowers will be allowed to borrow under the previous student loan limits. Note: Details on handling legacy provisions for legacy borrowers are still in progress.
How do I determine if I qualify for legacy provisions or how do I maintain my legacy status?
Read our resources for students on how to determine whether or not they qualify for legacy provisions.
Do I qualify for legacy provisions?
Federal loan repayment plans under H.R.1
What are the new loan repayment plan options under H.R.1? The new law replaces most existing income-driven repayment plans with a new framework for federal student loan repayment. If you borrow additional loan funds on or after July 1, 2026, your repayment options will be limited to the tiered Standard Plan (with fixed monthly payments and fixed terms) and the Repayment Assistance Plan (RAP). This will affect both current and prospective students who take out new federal loans.
Eligibility for legacy loan repayment: Current borrowers with no new loans made on or after July 1, 2026, can continue to be eligible to enroll in the legacy standard repayment plan.
When it’s time to repay federal loans, check your repayment plan. It’s a good practice to periodically check your repayment plan to make sure your repayment terms are the same and have not changed. If your repayment terms have changed, reach out to your loan servicer to verify the terms. Example: Make sure the current terms reflect your salary if you’re on an income-driven plan.
What are my loan repayment options?