On July 4, 2025, the One Big Beautiful Bill Act (OBBBA), also referred to as the "Working Families Tax Cuts" Act, was signed into law, bringing changes to federal student aid programs. Some changes
took effect right away, while others are scheduled to begin in 2026 and later. This
page outlines updates that potentially impact your federal student aid, including
undergraduate, graduate and parent borrowers, and will be revised as additional information
becomes available.
Have questions on how this may impact you? Contact our office today to speak with one of our counselors.
Frequently Asked Questions
No.
In previous academic years, in order to be eligible for federal student loans, you
only needed to be enrolled in atleadt half-time credits. With the new federal policy
changes, in order to be eligible for the full amount of your federal student loans,
you must be enrolled atleast full-time for the full academic year.
Full-time Status:
Traditional Undergraduates: atleast 12 credits a semester/24 credits annually
Bachelor's Degree for Professionals: atleast 6 credits a term/ 30 credits annually
If you enroll less that full-time your loans will be subject to a Schedule of Reduction
(SOR).
*The only federal student loan NOT subject to SOR are Parent PLUS Loans
Yes.
If there is any break in enrollment after Summer 2026 or Term 5, you will be subject
to the new federal loan limits.
No. Your expected time to credential is not necessarily the same as your actual graduation date.
Beginning July 1, 2026, your expected time to credential is calculated as the lesser
of:
Three (3) academic years, or
The remaining published length of your program after subtracting the portion you completed
before July 1, 2026.
The published program length is the minimum amount of time a full-time student is expected to complete a specific
program, as listed in your school's catalog, marketing materials, or other official
publications.
Because this calculation is based on your program's published length—not the date
you actually graduate—your expected time to credential may end before your actual
graduation date if you take longer than the published program length to complete your
degree.
This new law only impacts federal loan programs such as Federal Direct Loans, Parent
PLUS Loans and Graduate PLUS Loans.
CLU still works and processes all Private Loan requests.
Review your academic program and work with academic advising to ensure your coursework
for the upcoming academic year is planned to maximum aid eligibility. In order to
ensure you are receiving the maximum amount you are eligible for, be sure to maintain
atleast full-time enrollment (12+ credits for undergraduates, 6+ credits for bachelors
degrees for professionals, and 6+ credits for graduates).
For traditional undergraduate students and Bachelor's Degree for Professionals students
Pell Grant Eligibility
The biggest impacts to your federal aid will be how your Pell Grant eligibility is
calculated and the requirements to receive your full loan amounts. Pell Grant eligibility
is now more closely tied to your Student Aid Index (SAI), which means aid is more
strictly based on your family’s financial situation reported on your FAFSA.
What impact does this have?
You might receive a smaller Pell Grant than expected
You may no longer qualify for the Pell Grant despite receiving it in previous years
If your costs are already fully covered by other scholarships, you may not receive
Pell funds
Loan Eligibility (Schedule of Reductions)
Beginning July 1, 2026, Federal Direct Loans will be reduced based on the number of
credits in which a student is enrolled. This process is called the Schedule of Reductions (SOR).
With the new Federal Direct Loan SOR requirement, full-time students will receive
the full amount of their annual loan offer. If a student is enrolled less than full-time, they will not be eligible to receive
the full-time amount of loans offered to them. Instead, the university will calculate
the amount of loan funding the student is eligible to receive based on the number
of credits in which they are enrolled.
You still need to maintain at least a half-time enrollment status to receive a Direct
Loan for a particular semester.
Frequently Asked Questions
Yes. Starting with the 2026-2027 academic year, all federal loans are subject to a
scheduled reduction (SOR) for students who are not enrolled atleast full-time (12+
credits for traditional undergraduate students, 6+ credits for bachelors degrees for
professional students).
You (and your parent) would only continue to be eligible for the interim exception
for the semester you have remaining.
If you require additional semesters after your final semester to complete your degree
requirements, your parent will subject to the 'new borrower' loan limits.
Keep in mind: Your aid is more closely tied to both your family's reported income and how many classes
you take, so small changes can have a bigger impact.
Parent PLUS Loans
For parents of traditional undergraduate students
New federal rules will change how much parents can borrow through the Parent PLUS
Loan program, as well as the repayment options available for those loans. These changes
do not affect how much undergraduate students can borrow through their own federal loans.
Under the new law, Parent PLUS Loans will be limited to:
$20,000 per year, and
$65,000 total per student
However, there is a temporary exception for families with students who are already
enrolled.
To qualify for the temporary exception, the student must:
Remain continuously enrolled in the same program at the same school they were attending
as of June 30, 2026
In addition, one of the following must be true:
The parent previously received a Parent PLUS Loan for that student’s program before July 1, 2026, OR
The student received a federal Direct Loan (subsidized or unsubsidized) for that program
before July 1, 2026
If the above conditions are met, the new loan limits will not apply right away under
the limited exception. Parents who qualify will be able to continue borrowing under
the current rules for up to three years or until their student finishes their program
(whichever happens first). In order to remain continuously eligible for the limited
exception, the student must stay continuously enrolled in their program (no full withdraws or unapproved breaks).
To learn more about important updates that parents need to know, please .
Frequently Asked Questions
New borrowers are students who do not qualify for the legacy loan provision described
below.
A student may qualify for the legacy loan provision if, prior to July 1, 2026, the
student (or a parent on the student’s behalf) borrowed a Direct Loan while the student:
was enrolled in a degree program at CLU;
will continue in the same program during the Fall 2026 term; and
is progressing toward completion within the program’s published length, as determined
by the academic program at CLU.*
Under the legacy loan provision, borrowers may remain eligible for up to three additional
academic years or through the remainder of the program’s published length—whichever
period is shorter. Eligibility under this provision will not extend beyond June 30,
2029.
* Contact your academic advisor if you have questions about, or are unsure of, your
program’s published length.
If you or your student received a Federal Direct Loan (subsidized, unsubsidized, or
Parent PLUS) before July 1, 2026, while the your student was enrolled in a program
of study at CLU, you may continue borrowing under the current loan limits for up to
three additional academic years or through the remainder of your student’s expected
time to credential, whichever is shorter.
In other words, the legacy provision applies to undergraduate students and parent
borrowers who had any type of Direct Loan disbursed and applied to the student’s CLU
tuition account before July 1, 2026. As long as the student remains enrolled at CLU
in an undergraduate degree-seeking program, parent borrowers may continue to access
current loan limits for up to three additional academic years or for the remainder
of the program’s published length—whichever period is shorter.
As long as the student remains continuously enrolled in the same degree level (for
example, a bachelor’s degree program), changing majors will not affect eligibility
under the legacy provision. In these cases, the provision will continue to apply for
up to three academic years or through the student’s remaining expected time to credential,
whichever is shorter.
Example 1: A current CLU student changes majors from English (Bachelor of Arts) to Engineering
(Bachelor of Science). Because the student remains enrolled in a bachelor’s degree
program, the change in major does not affect eligibility for the parent PLUS legacy
loan provision. The student is still considered enrolled in the same program of study
for purposes of the provision.
Example 2: A current CLU student enters as an undeclared bachelor’s student and later declares
a major in Exercise Science. Because the student remains enrolled in a bachelor’s
degree program at CLU, they are considered to be continuing in the same program of
study, and the parent PLUS legacy loan provision continues to apply.
Example 3: A current CLU student enrolled in a bachelor’s degree program transfers to another
institution to complete their degree beginning in the 2026–2027 academic year. Although
the student remains in the same degree level, the student is no longer enrolled at
CLU. As a result, the parent PLUS legacy loan provision no longer applies, and the
parent borrower would be considered a new borrower subject to the new borrowing limits.
Yes. If a student ceases enrollment for any period of time (official or unofficial),
parents will be considered new borrowers subject to the new loan limits once the student
returns.
To maintain eligibility for the Parent PLUS Loan legacy provision, students must maintain
enrollment for each of the required terms in their program (fall and spring). Summer
is treated as an optional term for undergraduate students.
Parent PLUS loam limits under the new borrowing guidelines ($20,000 per year, $65,000
aggregate amount) are per student, not per family.
If your student is required to attend a fifth year to complete the requirements for
a four-year degree, your eligibility for the interim exception depends on your student's
remaining expected time to credential.
Under federal regulations, a student's expected time to credential is the lesser of:
Three (3) academic years, or
The remaining published length of the program after subtracting the portion completed
before July 1, 2026.
For example, if your student is enrolled in a four-year program and has already completed
four years by July 1, 2026, their remaining expected time to credential is zero years.
In that case, the interim exception no longer applies, and any Parent PLUS Loans borrowed
for a fifth year will be subject to the new federal Parent PLUS Loan limits
Keep in mind: Parent loans are no longer an unlimited backup option for all borrowers, so it’s
important to understand costs early and have a plan in place.
Graduate Loans
For all graduate students
With the regulations, federal loans for graduate students have new lifetime limits
based on program type. This means that there is now a maximum total amount you can
borrow, no matter how expensive your program is.
What this could mean for you:
You may not be able to borrow enough federal student loans to cover your full cost
of attendance
Once you reach your limit, you cannot borrow more in federal loans
To learn more about important updates that Graduate students need to know, please
To learn more about important updates that PsyD students need to know, please
Frequently Asked Questions
New borrowers are students who do not qualify for the legacy loan provision described
below.
A student may qualify for a limite exception if, prior to July 1, 2026, the student
borrowed a Direct Loan while the student:
was enrolled in a degree program at CLU;
will continue in the same program during the Fall 2026 term; and
is progressing toward completion within the program’s published length, as determined
by the academic program at CLU.*
Under the limited exception, borrowers may remain eligible for up to three additional
academic years or through the remainder of the program’s published length—whichever
period is shorter. Eligibility under this exception will not extend beyond June 30,
2029.
* Contact your academic advisor if you have questions about, or are unsure of, your
program’s published length.
No. To be eligible for the Graduate PLUS legacy provision, you must borrow a graduate-level
loan and have it disbursed to your account prior to July 1, 2026.
"Program of study" refers to the program you are enrolled in while in pursuit of your
graduate degree.
The only two Profressional Degrees offered at CLU are the Doctorate in Psychology (PsyD) program
and MDiv. program.
In the Department of Education's most recent announcement on June 29th, all other
Cal Lutheran programs were determined to be Graduate Degrees and therefore subject
to the standard graduate Direct Unsubsidized Loan Limits.
If a borrower has received a Federal Direct Loan prior to July 1, 2026, while enrolled
in their program of study, the borrower can continue to borrow Graduate PLUS Loans
for up to 3 additional academic years, or the remainder of their expected time to
credential, whichever is less but not to exceed June 30, 2029.
In other words, the legacy provision applies to graduate students who borrow a Direct
Loan of any type and have it disbursed to their CLU account before July 1, 2026. As
long as the student remains enrolled in the same program of study at CLU, they may
continue borrowing for up to three additional academic years, or for the remainder
of the program’s published length—whichever is shorter.
Yes. If you withdraw or cease enrollment for any required term, you will be considered
a new borrower upon your return and will be subject to the following borrowing limits:
Graduate degree programs: $20,500 per academic year, $100,000 graduate aggregate limit, $257,500 lifetime aggregate
limit (includes undergraduate and Grad PLUS borrowing). Not eligible for Grad PLUS
loan program.
Professional degree programs: $50,000 per academic year $200,000 prof. aggregate limit, $257,500 lifetime aggregate
limit (includes undergraduate and Grad PLUS borrowing). Not eligible for Grad PLUS
loan program.
To maintain eligibility, you must maintain enrollment for all required terms associated
with your program - if summer is a required term, you must maintain enrollment to
keep your legacy loan provision.
You would only continue to be eligible for the interim exception for the semester/term
you have remaining.
If you require additional semesters after your final semester to complete your degree
requirements, you will be subject to the federal loan limits.
If you need additional time to complete your graduate or professional program, your
eligibility for the interim exception depends on your remaining expected time to credential.
Under federal regulations, a student's expected time to credential is the lesser of:
Three (3) academic years, or
The remaining published length of the program after subtracting the portion completed
before July 1, 2026.
For example, if you are enrolled in a two-year graduate program and have already completed
the published program length by July 1, 2026, your remaining expected time to credential
is zero years. In that case, the interim exception no longer applies, and any additional
Direct Unsubsidized Loans or Direct PLUS Loans for Graduate/Professional Students
will be subject to the new federal loan limits.
Annual loan limit: Total Direct loan amount a student can receive in a academic year based on degree
type.
Aggregate loan limit: The maximum amount a student can receive in Direct loans as a graduate or professional
student.
Lifetime aggregate loan limit: The combined total amount of undergraduate and graduate loans a student received
under the Direct and/or FFEL loan programs (including Grad PLUS loan debt). Combined
total includes loans forgiven, repaid, and discharged.
Keep in mind: Your federal loan eligibility will be based on your program. Use our tool to determine which federal loan limits apply to you.
Loan Repayment (All Federal Loan Borrowers)
For any federal loans (Subsidized, Unsubsidized, Parent PLUS Loan, or Grad PLUS Loan)
borrowed on or after July 1st, 2026, only two repayment plans will be available:
A standard repayment plan with fixed monthly payments
A single income-based repayment plan (RAP) tied to your earnings
Have more questions on what these changes mean for your aid? Visit the on the Federal Student Aid website to learn more.