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Impact of Recent Legislation on Financial Aid
The One Big Beautiful Bill Act (H.R.1) was signed into law by President Trump on July 4, 2025. This landmark legislation introduces significant changes to federal student aid programs under Title IV.
This page is a developing resource designed to keep students, families, and the William & Mary community informed as details emerge. Our goal is to provide clear, timely updates to help you understand and prepare for the upcoming changes.
The new provisions will affect all types of students—current and prospective, undergraduate and graduate—with implementation scheduled for July 1, 2026. While some aspects of the law are already defined, others will require additional clarification from the U.S. Department of Education. As official guidance becomes available, we will continue to update and expand this page to ensure you have the most accurate and actionable information possible.
ResourcesDepartment of Education Updates One Big Beautiful Bill Act Updates - Federal Student Aid A Brief Overview of OBBBA Loan Impacts - NASFAA (National Association of Student Financial Aid Administrators) Current Parent Borrowers, an overview - NASFAA (National Association of Student Financial Aid Administrators) New Parent Borrowers, an overview - NASFAA (National Association of Student Financial Aid Administrators) Graduate Student Borrowers, an overview - NASFAA (National Association of Student Financial Aid Administrators) Professional Graduate Student Borrowers, an overview - NASFAA (National Association of Student Financial Aid Administrators) W&M's Law School is the only program at this time that meets the requirement to be considered a Professional Graduate Student Program Private Education Loans: Information for Students & Families - NASFAA (National Association of Student Financial Aid Administrators) Private Loan Checklist for Prospective Student and Parent Borrowers - NASFAA (National Association of Student Financial Aid Administrators)
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Federal Loan Program Lifetime Loan LimitsLegacy Provision: If a borrower has a Federal Direct Loan made before July 1, 2026, while enrolled in a credentialed program, the borrower can continue to borrow under current loan limits for 3 academic years or the expected remainder of their expected time to credential, whichever is less.
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Federal Parent PLUS LoansLegacy Provision: If a borrower has a Federal Direct Loan made before July 1, 2026, while the dependent student is enrolled in a credentialed program, the parent borrower can continue to borrow under current loan limits for 3 academic years or the expected remainder of their expected time to credential, whichever is less. It may be possible for a parent to be both a legacy borrower and fall under the new borrower limits, as the legacy provision is tied to the student the parent is borrowing for. We expect greater guidance as negotiated rulemaking is ongoing. Current Parent Borrowers, an overview - NASFAA (National Association of Student Financial Aid Administrators) New Parent Borrowers, an overview - NASFAA (National Association of Student Financial Aid Administrators)
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Federal Graduate PLUS LoanLegacy Provision: If a borrower has a Federal Direct Loan made before July 1, 2026, while enrolled in a credentialed program, the borrower can continue to borrow from the GradPLUS program for 3 academic years or the expected remainder of their expected time to credential, whichever is less. Graduate Student Borrowers, an overview - NASFAA (National Association of Student Financial Aid Administrators) Professional Graduate Student Borrowers, an overview - NASFAA (National Association of Student Financial Aid Administrators) W&M's Law School is the only program at this time that meets the requirement to be considered a Professional Graduate Student Program
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Federal Graduate LoansLegacy Provision: If a borrower has a Federal Direct Loan made before July 1, 2026, while enrolled in a credentialed program, the borrower can continue to borrow under current loan limits for 3 academic years or the expected remainder of their expected time to credential, whichever is less. Graduate Student Borrowers, an overview - NASFAA (National Association of Student Financial Aid Administrators) Professional Graduate Student Borrowers, an overview - NASFAA (National Association of Student Financial Aid Administrators) W&M's Law School is the only program at this time that meets the requirement to be considered a Professional Graduate Student Program
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Loan Impact for Less than Full-Time Enrollment
One of the most significant changes for students is a new federal requirement related to loan proration based on enrollment level. What Is Changing? Under current federal rules, many students enrolled at least half-time may still qualify for the standard annual federal loan amount. Beginning in 2026–27, federal loan eligibility will instead be adjusted proportionally based on a student’s enrollment status if they are enrolled less than full-time. This means that students enrolled:
What Is Considered Full-Time? Federal loan proration will be based on your enrollment level according to your academic program.
Examples of How This Could Impact Students Scenario 1: Undergraduate Student Enrolled Half-Time Maria is an undergraduate student who normally qualifies for a $5,500 annual federal Direct Loan ($2,750/semester. She enrolls in 6 credits during the fall semester rather than 12 credits full-time. Result: Under the new rules, Maria’s loan eligibility would be prorated based on her reduced enrollment level from $2,750 to $1,375. Scenario 2: Student Drops Courses After Aid Is Awarded James initially enrolls full-time and receives his full $2,750 federal loan eligibility for the semester. After classes begin, he drops to 8 hours of enrollment. Under the new federal rules, W&M is required to reduce his federal loan eligibility from $2,750 to $1833.33 to align with his updated enrollment status. Result: Under the new federal rules, W&M is required to reduce his federal loan eligibility from $2,750 to $1833.33 to align with his updated enrollment status. James could experience a reduction in future disbursements or potentially owe back a portion of aid already received. Scenario 3: Graduate Student Enrolled Less Than Full-Time Taylor is a graduate student eligible for $10,500 of Stafford Loans for the Fall semester but enrolls in 6 credits instead of the full-time requirement of 9 credits. Result: Although Taylor remains eligible for federal loans because they are enrolled at least half-time, the loan amount will now be reduced from $10,500 to $6,833.33 due to less-than-full-time enrollment. Scenario 4: Student Maintains Full-Time Enrollment Jordan remains enrolled full-time for the entire academic year. Result: Jordan’s federal loan eligibility would generally remain unchanged under the new proration rules. Important Notes
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Pell Grant Eligibility ChangesThere are no legacy provisions, and changes are all set to be implemented on July 1, 2026.
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