Key Changes to Federal Loans

Elimination of the Grad PLUS Loan:

Effective July 1, 2026, this bill eliminates the Grad PLUS Loan program for new borrowers; therefore new students enrolling in NECO after 7/1/2026 will not be able to borrow the Grad PLUS loans.

Legacy Provision

Existing students with a Grad PLUS Loan (current borrowers), or those who have borrowed a Grad PLUS Loan by June 30, 2026, may continue borrowing under the current terms for up to three academic years, or the remainder of your program completion, whichever is less.

New Borrowing Caps for Stafford Loans  

For professional programs, such as the Optometry program, Stafford loans will be capped at $50,000/year, with an aggregate limit of $200,000 (excludes borrowing as an undergraduate).

Existing students with a Stafford loan (current borrowers), may continue borrowing under the current limits for up to three academic years, or the remainder of your program completion, whichever is less.

(1) A professional degree is a degree that:

(i) Signifies both completion of the academic requirements for beginning practice in a given profession, and a level of professional skill beyond that normally required for a bachelor’s degree;

(ii) Is generally at the doctoral level, and that requires at least six academic years of postsecondary education coursework for completion, including at least two years of post-baccalaureate level coursework;

(iii) Generally, requires professional licensure to begin practice; and

(iv) Includes a four-digit program CIP code, as assigned by the institution or determined by the Secretary, in the same intermediate group as the fields listed in paragraph (2)(i) of this definition.

(2) A professional degree may be awarded in the following fields:

(i) Pharmacy (Pharm.D.), Dentistry (D.D.S. or D.M.D.), Veterinary Medicine (D.V.M.), Chiropractic (D.C. or D.C.M.), Law (L.L.B. or J.D.), Medicine (M.D.), Optometry (O.D.), Osteopathic Medicine (D.O.), Podiatry (D.P.M., D.P., or Pod.D.), Theology (M.Div., or M.H.L.), and Clinical Psychology (Psy.D. or Ph.D.).

(3) A professional student under this definition:

(i) May not receive title IV aid as an undergraduate student for the same period of enrollment; and

(ii) Must be enrolled in a program leading to a professional degree under paragraph (2) of this definition.”

Repayment Plan Changes

Federal loans created after July 1, 2026, will only have two repayment options and borrowers must choose one or the other:

1. The Standard repayment Plan (10–25 years, tiered by balance).
2. Repayment Assistance Plan (RAP): $10 minimum monthly, loan forgiveness after 30 years.

Federal loans created prior to July 1, 2026, maintain the existing loan repayment options (Standard, Graduated, current IBR, and Extended).