Important Federal Student Loan Changes: What Bastyr Students Need to Know

Major changes are underway at the federal level that could impact how students plan and pay for undergraduate, graduate, and professional education. These changes, part of newly passed legislation, will reshape loan eligibility, borrowing limits and access to critical federal aid programs.

At Bastyr, we recognize that navigating financial aid is already complex. Our goal is to ensure you feel supported, informed and empowered to make decisions with confidence. As the Department of Education releases further guidance and finalizes implementation, we will continue to update you and advocate for student needs at both the state and federal levels.

What’s Changing

1. Grad PLUS Loans Ending

Effective July 1, 2026, the federal Graduate PLUS Loan program will no longer be available to new borrowers. This program currently allows graduate and professional students to borrow up to the full cost of attendance.

2. New Federal Loan Limits

Beginning with the 2026–2027 academic year, the following borrowing caps will apply:

Undergraduate programs: New lifetime borrowing cap of $65,000 across all Direct Subsidized and Unsubsidized Loans. Current annual loan limits ($5,500–$12,500, depending on dependency status and year) will remain the same

• Master’s programs: Up to $20,500 per year; $100,000 lifetime limit
• Professional degree programs: Up to $50,000 per year; $200,000 lifetime limit

3. Parent PLUS Loan Limits

For dependent undergraduate students using Parent PLUS Loans, borrowing will be capped at $20,000 per year and $65,000 lifetime.

4. Grandfathering for Current Borrowers

Students who borrow a Grad PLUS Loan before July 1, 2026 and remain continuously enrolled may be eligible to continue borrowing under current rules for up to three additional academic years or until completing their program, whichever comes first.
Note: Final federal guidance on this provision is still pending.

What This Means for Bastyr Students

Undergraduate students: Access to subsidized and unsubsidized loans will remain at current annual levels, but total borrowing will now be capped at $65,000

Master’s students: Future loan access will be limited to $20,500/year, $100,000 lifetime

Professional students: Future access will be limited to $50,000/year, $200,000 lifetime

• These new limits may not cover full tuition, fees and living costs in some programs
• To preserve current borrowing eligibility, start your program before July 1, 2026 and consider initiating a Grad PLUS Loan. Early borrowing may support eligibility under the grandfathering provision
• The lifetime aggregate limit for all federal student loans (including undergraduate borrowing) will be $257,500

Action Steps for Current & Prospective Students

1. Review your 2025–2026 financial aid package and consider Grad PLUS Loan options before July 1, 2026
2. Schedule a 1:1 meeting with Bastyr’s Financial Aid Office here @FinAid to:
   • Understand how these changes may affect your financial aid eligibility
   • Explore private loans, scholarships and payment plan options
   • Estimate your borrowing needs across your full program
3. Apply early for PLUS loans during the 2025–26 academic year to secure eligibility under current rules
4. Stay informed. We will continue sharing updates as more details emerge from the U.S. Department of Education

We’re Here for You

We understand that these changes may feel overwhelming. The Bastyr Financial Aid Office is committed to helping you navigate this transition with compassion, transparency and personalized support. You’re not alone in this process.

Please contact us @FinAid with any questions or schedule your advising appointment by June 1, 2026, to review your options and develop a funding strategy that works for you. 

Resources & References

• Federal Grad PLUS Loan Overview – studentaid.gov
• Annual & Aggregate Loan Limits – FSA Handbook
• Loan Cap Legislation Overview – NASFAA
• PLUS Loan Summary – The College Investor