One Big Beautiful Bill Act

  One Big Beautiful Bill Act (OBBBA)

On July 4, 2025, H.R. 1 (One Big Beautiful Bill Act) was enacted into law. Significant changes to federal student aid will take effect beginning July 1, 2026. This includes updates to the Federal Pell Grant and Direct Loan programs.

Pell Grant Changes

The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, includes significant changes to Pell Grant eligibility beginning with the 2026–27 academic year.

Inclusion of Foreign Income

  • Foreign income is now automatically included in the Adjusted Gross Income (AGI) used to determine Pell Grant eligibility on the FAFSA. As a result of this change, some students and families with foreign income who received a Pell Grant in prior years may lose eligibility beginning in 2026–27.

Student Aid Index (SAI) Threshold

  • Students with a Student Aid Index (SAI) of 14,790 or higher (twice the maximum Pell Grant award) are no longer eligible to receive a Pell Grant.

Students Fully Covered by Non-Federal Aid

  • Students whose full Cost of Attendance (COA) is covered by non-federal grants or scholarships (institutional, state, or private) are no longer eligible to receive a Pell Grant, even if otherwise eligible for the program.

Student Loans

The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, includes significant changes to federal student loan programs. Most provisions apply to periods of enrollment beginning on or after July 1, 2026.

Enrollment & Financial Aid Eligibility 

Financial aid for part-time students is adjusted based on the number of credits they are taking and their academic level.

  • Full-time enrollment is defined as:
    • Undergraduate students: 12 or more credits per semester
    • Graduate students: 6 or more credits per semester

To be eligible for federal student loans, students must be enrolled at least half-time based on their academic level.

Undergraduate Less than Full-time Enrollment 

Undergraduate students are generally expected to take 12 or more credits per semester (24 credits across the fall and spring terms).

If a student enrolls in fewer than 12 credits, their loan eligibility is reduced proportionally:

  • A student taking 12 or more credits in the fall may receive up to 50% of their annual loan limit for that semester.
  • A student taking 6 credits in the fall (which is 6 out of 24 credits for the academic year) may receive about 25% of their annual loan limit for that semester.
Undergraduate Enrollment Percent of the annual loan limit
12+ 50.00%
11 45.83%
10 41.67%
9 37.50%
8 33.33%
7 29.17%
6 25.00%
5-1 0%

 

Graduate Less than Full-time Enrollment 

Graduate students are generally expected to take 6 credits per semester (12 credits across the fall and spring terms).

If a student enrolls in fewer than 6 credits, their loan eligibility is reduced proportionally:

  • A student taking 6 credits in the fall may receive up to 50% of their annual loan limit for that semester.
  • A student taking 3 credits in the fall (3 out of 12 credits for the academic year) may receive about 25% of their annual loan limit for that semester.
Graduate Enrollment Percent of the annual loan limit
6+ 50.00%
5 41.67%
4 33.33%
3 25.00%
2-1 0%

 

Undergraduate Students

Parent PLUS Loan Limits

  • New borrowers will be limited to $20,000 per year and $65,000 total (aggregate) per dependent student.

  • Previously, Parent PLUS borrowers could borrow up to the student’s full Cost of Attendance (COA), including both direct and indirect costs.

Graduate Students

Graduate PLUS Loan Program

  • The Graduate PLUS Loan program will be eliminated.

  • Graduate students will no longer be able to borrow up to the full Cost of Attendance through this program.

  • Grandfathering Rule: Students may continue to borrow under current rules (including Grad PLUS) for up to 3 years if they remain in the same degree program and borrowed for it before July 1, 2026.

Direct Unsubsidized Loan Limits

  • Graduate students:

    • Annual limit remains $20,500

    • New aggregate limit of $100,000 (not including undergraduate loans)

    • The previous aggregate limit was $138,500 (including undergraduate loans)

All Students

  • A new lifetime maximum of $257,500 will apply to all federal student loans combined (excluding Parent PLUS and Graduate PLUS loans).

  • Institutions will have the authority to set lower loan limits by program of study.

These federal changes may impact future borrowing eligibility beginning in 2026–27. Students are encouraged to plan carefully and contact the Financial Aid & Scholarship office with questions about how these changes may affect them.

Actions Items to Consider

Actions to take on Federal Parent PLUS Loans OR Graduate PLUS Loans:

If you are considering a Parent PLUS Loan or Graduate PLUS Loan, you may want to review your options soon.

To take advantage of the current (higher) PLUS loan limits, parents of current students and current graduate students should complete all PLUS Loan Application requirements and have funds disbursed by the end of the Spring 2026 semester.

Loans first disbursed on or after July 1, 2026, will be subject to the new federal loan limits.

If you are unsure whether borrowing now makes sense for your situation, we encourage you to connect with the Financial Aid & Scholarships office to review your options.

Private Loan Funding

Private Loan programs are unsecured educational loans offered by banks, credit unions, and other financial institutions. These loans must be repaid with interest. Interest rates vary based on your creditworthiness and/or the creditworthiness of a co-signer.

CSUCI partners with ELMSelect to provide opportunities to review different loan options and select the lender that best fits your needs. CSUCI is lender-neutral and cannot recommend a specific lender to students or families.

Outside Scholarship Funding

External scholarships offered by organizations not affiliated with CSUCI must be reported to our office. Students are encouraged to explore scholarship search engines such as FastWeb and Finaid.org to assist with their search. Please remain vigilant against scholarshipscams.

Outside Scholarships may be based on academic achievement, personal qualifications, or field of study, and may be offered by:

  • Community Groups
  • Private Organizations
  • Employers
  • Foundations
  • Professional Associations

Last Updated: 4/24/26

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