Federal Student Financial Aid Changes

Beginning with the 2026-27 academic year, some federal financial aid programs will change due to the new federal One Big Beautiful Bill Act (OBBBA), passed in July 2025.

All details are subject to change pending the release of the final regulatory text, which is expected in May or June 2026. BGSU’s Office of Student Financial Aid is closely monitoring federal guidance and will continue to share updates as more details become available.

We’re here to help

These federal changes are significant, but you’re not navigating them alone. BGSU’s Student Financial Aid team will continue to provide updates, guidance and individualized support as more information becomes available.

When will changes affect students?

Most changes take effect July 1, 2026, and apply to financial aid for the 2026-27 academic year and beyond.

Some details are still based on draft federal regulations and may change once final rules are released.

Because federal regulations are still being finalized, students may experience:

  • Delays in summer financial aid offers or summer loan disbursements
  • Delays in refunds for students who rely on aid to cover living expenses

SFA is working closely with the Office of the Bursar to make sure you won’t be charged late fees if delays in processing federal aid affect your ability to pay your summer bill on time.

In late April to early May, updates to the FAFSA may temporarily delay our ability to receive and process new or corrected FAFSA forms.

 

Federal direct loans

  • Federal loan limits for undergraduate students are not changing.
  • How loans are calculated is changing.

Starting in 2026-27:

  • Federal loans will be based on annual enrollment, not just term-by-term enrollment.
  • Students enrolled less than full-time (12 credit hours) could have their subsidized and unsubsidized loans prorated based on annual credit hours. This includes courses dropped AFTER a semester has started.

Parent PLUS loans

For Parent PLUS loans borrowed on or after July 1, 2026:

  • $20,000 annual limit per dependent student
  • $65,000 lifetime limit per dependent student

These limits apply per student, regardless of how many parents borrow.

Legacy Parent PLUS borrowers

Some families may qualify for a legacy provision.

  • Parents who borrowed a Parent PLUS loan for their dependent student before July 1, 2026, may be able to continue borrowing up to the student’s cost of attendance.
  • This may apply for up to three academic years or until the student completes their current program, whichever comes first.

Federal Pell grant

  • Students are not eligible for a federal Pell grant if their Student Aid Index (SAI) exceeds twice the maximum Pell grant award ($7,395 for the 2026-27 year).
  • Scholarships and non-federal grants that cover 100% of the cost of attendance may prevent a student from being eligible for the federal Pell grant.

Changes to loan repayment after graduation

For loans borrowed beginning July 1, 2026:

  • Federal repayment plans will be simplified.
  • Borrowers will generally choose between:
    • A standard repayment plan, or
    • A new Repayment Assistance Plan (RAP) based on income

Grad PLUS loans

  • Grad PLUS loans will be eliminated for new borrowers beginning July 1, 2026.
  • Students who borrowed a grad PLUS loan prior to that date may be able to continue borrowing under legacy rules for a limited time (can continue to borrow for 3 academic years or the remainder of their expected time to credential, whichever is less).

Federal direct unsubsidized loans

  • Annual limit remains $20,500.
  • New $100,000 lifetime limit for graduate borrowing (undergraduate loans are not included). The legacy rules may apply here for a student who has borrowed a federal direct loan before July 1, 2026 – the current loan limits will apply for 3 academic years or the remainder of their expected time to credential, whichever is less.

Changes to loan repayment after graduation

For loans borrowed beginning July 1, 2026:

  • Federal repayment plans will be simplified.
  • Borrowers will generally choose between:
    • A standard repayment plan, or
    • A new Repayment Assistance Plan (RAP) based on income

Updated: 04/10/2026 04:33PM