One Big Beautiful Bill Act, Emerson College

On July 4, 2025, President Trump signed into law the "One Big Beautiful Bill Act,"a piece of federal legislation that changed federal student aid programs significantly. Some key changes, which are set to take effect on or after July 1, 2026, include updates to: Pell Grants, federal student loans, repayment plans and the 2026-2027 FAFSA application..

The Office of Financial Aid is continuing to track all of these changes and plan to update this site when necessary. We will continue to collaborate with the National Association of Student Financial Aid Administrators (NASFAA) and the U.S. Department of Education to seek further clarification and guidance as implementation of these changes progresses.

We here at Emerson College are committed to supporting students and their families during this time. While we may not have immediate answers to every question, we will share updates with the campus community as new information becomes available from the U.S. Department of Education. Please reach out if you have any questions.

Phone: 617-824-8655
Email: finaid [at] emerson.edu (finaid[at]emerson[dot]edu)

Important disclaimer: The information contained on this page is provided by Emerson financial aid staff to orient students to the changing landscape of federal student loan programs. While it is based on our good faith understanding of the evolving federal standards, it is not official guidance and should not be regarded by students as definitive. Students should refer to federal governmental sources for official guidance. See studentaid.gov for more information.

What We Know As of April 2026

Students who receive grants and scholarships from non-federal sources that cover the full cost of attendance will not be eligible for a Pell Grant. (Effective July 1, 2026 and beginning with the 2026-2027 academic year)
Students who have a Student Aid Index that exceeds twice the maximum Pell Grant amount will not be eligible for a Pell Grant. For example, the current max Pell amount for 2025-2026 is $7,395. If a student has a student aid index (SAI) of $14,790 or greater, the student will not be eligible for a Federal Pell Grant. (Effective July 1, 2026 and beginning with the 2026-2027 academic year)
Effective with the 2026-2027 FAFSA Application, Foreign income must be included in the Adjusted Gross Income (AGI) used to calculate Pell Grant eligibility. This will automatically be added into the AGI when determining Pell Grant eligibility.

Federal Direct Loan Program(s)

Federal Loan Program Lifetime Limits

All new federal student loan borrowers will have a lifetime borrowing maximum on all federal student loans of $257,500 (this amount excludes Parent Plus loans but includes any Graduate PLUS loans).

Graduate

Graduate Plus Loan

Grad PLUS loans will be phased out beginning on July 1, 2026; beginning on that date, new loans will not be available for new borrowers.
There will be some continuing eligibility for existing federal student loan borrowers as they complete their current programs.

New Graduate Unsubsidized Direct Loan Limits (effective July 1, 2026)

Current Emerson Graduate Programs:
- Up to $20,500/year, $100,000 lifetime borrowing limit.
  - To note: for students enrolled in year-round programs, they can still be eligible for up to $10,250 in additional loan funding for the Summer semester, for a total of up to $30,750 for the academic year
Professional programs (e.g., medicine, law, currently Emerson does not have any programs that qualify as a professional program):
- Up to $50,000/year, $200,000 lifetime borrowing limit.
Definitions of “professional” vs. “graduate” programs are still unclear (more on this below).

Undergraduate

Undergraduate Limits and Parent PLUS Loans

There are no changes for undergraduate loans, although undergraduate loans will count towards the new lifetime limits.
However, starting July 1, 2026, Parent PLUS loans will be capped at $20,000 per student per year, with a $65,000 lifetime limit per dependent student.
Existing Parent PLUS borrowers who have borrowed for their students before July 1, 2026, can continue with the current limits for 3 more years or until the student’s program ends.

What Remains Unclear

What is considered a “Professional” vs. “Graduate” Program?

Definitions and eligibility for higher borrowing caps available to students in “professional” programs are to be determined by ED, including how dual degree students will be treated.
However, the definition remains vague, with phrases like “not limited to” and “generally requires licensure.” In the months ahead, ED will need to confirm which programs qualify for the higher $50,000/year and $200,000/lifetime borrowing cap.
As Emerson did not previously offer any graduate programs designated by the Department of Education as “professional” programs, the professional loan limit changes do not currently impact any current Emerson programs.

Grad PLUS Loans for Existing Borrowers

If a student has borrowed a Direct Loan or Graduate PLUS loan prior to July 1, 2026 for their program and remains continuously enrolled in their academic program, they may be eligible for an exception to apply for additional Graduate PLUS loan funding for up to three years, or until they’ve reached their time to credential, whichever comes first. The federal government defines a student’s time to credential as the amount of time it takes a full-time student to complete an academic program according to the program’s standard academic length.
- If the full-time program length of a program is typically 5 semesters long, for example, then any student who previously received a Direct Loan or Graduate PLUS loan prior to July 1, 2026 and remains continuously enrolled could be eligible to apply for a Graduate PLUS loan up through the 5th semester of their program. After they complete that 5th semester, they would no longer be eligible for Graduate PLUS loan funding
  - Please note: the time to credential requirement includes all of a student’s enrollment, not just enrollment after July 1, 2026. In the above example, if a student had already completed 4 semesters prior to the 2026-2027 year, they would only be eligible for 1 additional semester of potential Graduate PLUS loan eligibility, regardless of if they’re attending full-time or part-time
Awaiting further guidance from ED.

Loan Reduction for Attending Less than Full-Time

The bill includes a provision to prorate loan amounts based on enrollment.
This could mean that part-time graduate students (e.g., those enrolled less than full-time) would only be eligible for a portion of the annual loan limit.
We are awaiting clarification from ED on how this will be applied to both graduate and undergraduate students.

New Repayment Plans

For new loans disbursed after July 1, 2026, the bill eliminates current income-driven repayment plans (IBR, PAYE, SAVE) and replaces them with a new Repayment Assistance Program (RAP).
Students who have borrowed loans before July 1, 2026, and will borrow a new loan after July 1, 2026, are limited to the new RAP or the standard plans for the new loan.
RAP borrowers will not be locked into a 30-year plan. They can switch to a standard plan, which ranges from 10 to 25 years.
Borrowers with no new loans made on or after July 1, 2026, can continue to be eligible to enroll in the current Standard, current Income Based (IBR), Graduated, and Extended repayment plans, and could also opt in to the new RAP. Current borrowers enrolled in ICR, PAYE, or SAVE plans must transition to a new repayment plan by July 1, 2028. If no selection is made by that date, they will be moved into RAP.
More information on the new RAP is forthcoming.

Additional Resources

For additional resources published by Federal Student Aid (FSA) and national associations, please visit: