New federal loan caps put students in a post-grad pickle
Graphic by Easton Clark, Photo Editor
Under the One Big Beautiful Bill Act, the government is scheduled to initiate cuts on student loans beginning in July 2026, which may change undergraduates’ plans to pursue a secondary degree. Donald Trump has limited graduate students to $20,500 in student loans annually, with a lifetime limit of $100,000.
The U.S. Department of Education is discontinuing the Grad PLUS loans, which help cover educational costs, and capped Parent PLUS loans — unsubsidized loans that parents can take out for dependent undergraduate students, which allowed students to borrow the full cost of their graduate program. This will specifically affect lower-income students and families, limiting their opportunities to attend certain institutions.
According to Congress, nearly 43 million U.S. citizens have federal student loan debt, totaling over $1.6 trillion. The Department of Education stated that this new act is essential to eliminating unnecessary debt and will lead to lower tuition costs.
The exception to the $20,500 limit is if you are obtaining a professional degree, such as ones in medicine, law, pharmacy and education. For these students, the annual loan cap will be extended to $50,000, with a lifetime cap of $200,000.
Ela Ince, a senior double majoring in psychology and peace and justice studies, shared her concerns about applying for graduate school.
“My original plan was to get a master’s degree in international relations,” Ince said. “But with this new law, I’m not sure if that’s the smartest path for me despite my passion in that field.”
Ince is starting to consider alternative options for obtaining a master’s if she is unable to secure the necessary financial support.
“I may need to go to a graduate school abroad because it’s definitely going to be cheaper, and the job market in America is limited anyway,” she said.
Nonetheless, graduate students have other options to manage the new policy.
Lauren Morrow, a student pursuing higher education in health and strategic communication at Chapman, said that the university helped her with financial relief, despite the anticipated loan cuts.
“Chapman’s 4+1 program was the best financial decision I could have made for graduate school,” Morrow said. “I was able to advocate for myself and get need-based scholarships from the university to afford my M.S.”
Many schools across the country offer integrated 4+1 programs; these accelerated degrees allow students to begin higher education coursework in their final year of undergrad, then complete an additional year before earning their master’s degree.
At Chapman, students save money through this program because they pay their undergraduate tuition in their senior year without additional charges for graduate classes.
“I took out more loans during my time as an undergraduate than I have as a graduate student,” Morrow said. “My advice for anyone thinking about graduate school is to look into Chapman’s integrated programs and really advocate for yourself to get the financial aid that you need.”
With 2026 loan caps looming, some students are considering going to graduate school abroad or changing their career paths; others are turning to the more readily available options, such as integrated programs or institutional aid.
For more information, reach out to Chapman University’s Graduate Financial Aid Office at (714) 628-2730 or gradfinaid@chapman.edu.