OBBB Financial Aid Impact

July 4, 2025. For students, families, and institutions like Beacon College, this bill is significant because it changes some rules related to the federal aid (Title IV) programs, such as borrowing caps and limitations. For example:

Changes some rules for determining Pell Grant eligibility
Modifies the Federal Direct Parent PLUS Loan program
Introduces new eligibility criteria and reporting requirements that could affect how aid is awarded and maintained

As of today, these changes are scheduled to go into effect July 1, 2026, and/or with the 2026-2027 Free Application for Federal Student Aid (FAFSA).

Stay Updated: Check back for updates. This page will continue to be updated as new information becomes available.

What We Know

We currently understand that adjustments are being put in place regarding loan options for students and parents of dependent students. the links below go into further detail on the changes and updates of each loan type that will have adjustments following the provisions of the new bill. Some provisions are straightforward and already under review by our team.

FAFSA & Financial Aid Eligibility Changes

The Free Application for Federal Student Aid (FAFSA) is required for Federal aid eligibility consideration.

The One Big Beautiful Bill (HR1), signed on July 4, 2025. For students, families and institutions like Beacon College, this bill is significant because it changes some rules related to the federal aid (Title IV) programs.

As of the development of this webpage, these changes are scheduled to go into effect July 1, 2026 and/or with the 2026-2027 FAFSA.

FAFSA Changes Effective July 1, 2026:

Family farms and family-owned small businesses will no longer be counted as assets (reverting to rules before FAFSA simplification)
- Family Farm – farms on which the family resides
- Small Business – 100 or fewer full-time (of full-time equivalent) employees
Family-owned commercial fisheries are now exempt from asset reporting
Foreign Income Reporting: Foreign income must now be included in the Adjusted Gross Income (AGI) for Pell eligibility. Removes the need for financial aid staff to decide whether foreign income affects Pell Grant eligibility.

Pell Grant Updates:

Pell Grants & Full Scholarships:
- Students whose Cost of Attendance (COA) is fully covered by non-federal aid will no longer be eligible for a Federal Pell Grant. Ends the previous allowance for Pell Grants to exceed COA when combined with other aid.
- Example: A Pell-eligible student with a scholarship covering the full Cost of Attendance will no longer receive both the scholarship and the Pell Grant.
Pell Grants and High Student Aid Index (SAI):
- Students with an SAI greater than twice the maximum Pell Grant amount will be ineligible for any Pell Grant.
- Example: If the max Pell Grant is $7,395, students with SAI over 14,790 will not qualify.

The One Big Beautiful Bill Act introduces significant changes to federal student aid programs, and while some provisions are clear, many others require further clarification from the U.S. Department of Education. We understand that students, families, and staff have questions – we do too!

As we receive more guidance and official updates, we will continue to revise and expand this webpage to reflect the most accurate and actionable information available.

Undergraduate Direct Student Loan Updates

The One Big Beautiful Bill (HR1), signed on July 4, 2025. For students, families and institutions like Beacon College, this bill is significant because it changes some rules related to the federal aid (Title IV) programs.

As of the development of this webpage, these changes are scheduled to go into effect July 1, 2026 and/or with the 2026-2027 FAFSA.

Current Limits	Changes Effective July 1, 2026
Part-Time Students can borrow full annual amounts Defined as less than 12-credits per term	Loans must be prorated based on enrollment status
Annual & Aggregate Limits are based on dependency status	Unchanged
Maximum Lifetime Borrowing Amount	Total Aggregate Limit: $257,000 across all federal loan programs (applies only to Beacon alumni planning graduate students)

Institutional Discretion:

Colleges may have the ability to set lower annual loan limits by program. Limits must apply uniformly to all students within that program.

The One Big Beautiful Bill Act introduces significant changes to federal student aid programs, and while some provisions are clear, many others require further clarification from the U.S. Department of Education. We understand that students, families, and staff have questions – we do too!

As we receive more guidance and official updates, we will continue to revise and expand this webpage to reflect the most accurate and actionable information available.

Parent PLUS Loan Updates

The One Big Beautiful Bill (HR1), signed on July 4, 2025. For students, families and institutions like Beacon College, this bill is significant because it changes some rules related to the federal aid (Title IV) programs.

As of the development of this webpage, these changes are scheduled to go into effect July 1, 2026 and/or with the 2026-2027 FAFSA.

Current Limits	Changes Effective July 1, 2026
Annual Limit: Determined by the formula of Cost of Attendance	Annual Limit: $20,000 per student (combined from all parents)
Aggregate Limit: None	Aggregate Limit: $65,000 per student
Eligibility is based on student enrollment and a minimal credit check of the parent applicant	Legacy Provision: Students with any existing Direct Loan may continue borrowing for up-to three years OR until program completion, whichever is less. Students must also remain in the same major (e.g. academic program) to be eligible for loans under this provision.
	New Borrowers: Must seek alternative funding if limits are exceeded

Institutional Discretion:

Colleges may have the ability to set lower annual loan limits by program. Limits must apply uniformly to all students within that program.

Planning Ahead:

For families that need funding outside of the new limits the options below can be pursued:

Private Loans (recommended lenders list for 2026-2027 to be available shortly)
Payment Plans
Home Equity or Personal Loans

The One Big Beautiful Bill Act introduces significant changes to federal student aid programs, and while some provisions are clear, many others require further clarification from the U.S. Department of Education. We understand that students, families, and staff have questions – we do too!

As we receive more guidance and official updates, we will continue to revise and expand this webpage to reflect the most accurate and actionable information available.

Direct Loan Repayment Updates

The One Big Beautiful Bill (HR1), signed on July 4, 2025. For students, families and institutions like Beacon College, this bill is significant because it changes some rules related to the federal aid (Title IV) programs.

As of the development of this webpage, these changes are scheduled to go into effect July 1, 2026 and/or with the 2026-2027 FAFSA.

Beacon College encourages any borrower who is currently in repayment of their federal loans to contact their loan servicer and discuss how these changes may impact their situation. This website provides a high-level overview and there may be other details a current borrower in repayment will want to consider before deciding on how to proceed.

Current Repayment Plans

Changes Effective July 1, 2026

Fixed-Term Plans:

Standard Repayment
Graduated Repayment
Extended Repayment
Income Sensitive Repayment

New Standard Repayment Plan

* only 10-year plan qualify for Public Service Loan Forgiveness (PSLF); requires at least 10-years of repayment.

10 Years* - Balances <$25,000
15 Years - Balances $25,000-$49,000
20 Years - Balances $50,000-$99,000
25 Years - Balances $100,000+

Income-Driven Plans (IDR)

Income-Based Repayment (IBR)
Pay As You Earn (PAYE)
Saving on a Valuable Education (SAVE)
Income-Contingent Repayment (ICR)

Income-Based Repayment Assistance Plan (RAP):

Monthly payment: 1% to 10% of AGI
$10 minimum payment
50 deduction per dependent
30-year repayment term; forgiveness after 30 years
No negative amortization (balances won’t grow when payments don’t cover interests)
Payments count toward PSLF

Borrower's AGI - Monthly Payment

$10,000 - $19,999 - 1% of monthly AGI
$20,000 - $29,999 - 2% of monthly AGI
$30,000 - $39,999 - 3% of monthly AGI
$40,000 - $49,999 - 4% of monthly AGI
$50,000 - $59,999 - 5% of monthly AGI
$60,000 - $69,999 - 6% of monthly AGI
$70,000 - $79,999 - 7% of monthly AGI
$80,000 - $89,999 - 8% of monthly AGI
$90,000 - $99,999 - 9% of monthly AGI
$100,000+ - 10% of monthly AGI

Current Borrowers:

IBR borrowers may remain in their plan
All other non-Parent PLUS IDR borrowers must choose a new plan by July 1, 2028 or be moved to RAP
Parent PLUS Loan borrowers will be moved to the new Standard Plan after July 1, 2028 unless they consolidate and enroll in an IDR before July 1, 2026. Doing so means they can remain in IBR for the duration of the repayment period.

The One Big Beautiful Bill Act introduces significant changes to federal student aid programs, and while some provisions are clear, many others require further clarification from the U.S. Department of Education. We understand that students, families, and staff have questions – we do too!

As we receive more guidance and official updates, we will continue to revise and expand this webpage to reflect the most accurate and actionable information available.