Reconciliation Bill of 2025 (One Big Beautiful Bill)
The Reconciliation Bill of 2025 (Public Law 119-21), also referred to as the One Big Beautiful Bill, was signed into law on July 4, 2025. This legislation introduces significant updates to several federal financial aid programs.
To help members of the VCU community understand these upcoming changes, we are sharing our current interpretation of the bill's provisions as they relate to financial aid. Please note that details are still emerging, particularly as the U.S. Department of Education has announced plans to develop new regulations in response to the law. As additional guidance becomes available, we will continue to update this information to reflect the most accurate understanding possible.
Most provisions will take effect beginning with the 2026-27 academic year, though a few exceptions may apply. The contents on this page are provided for informational purposes only and should not be considered official financial or legal advice, as further clarification from federal authorities is expected.
| Program/Area | Current Rules (pre-Bill) | Key Changes under the Bill | Grandfathering/Legacy Provision |
|---|---|---|---|
| Federal Direct Student Loans (Annual/Aggregate Borrowing Limits) |
Graduate/professional student annual Unsubsidized Loan borrowing: Up to $20,500 per year Graduate/professional student lifetime aggregate loan borrowing: $138,500 |
Graduate student annual borrowing: Unsubsidized Loan borrowing remains at $20,500. Graduate student aggregate lifetime borrowing limit: Reduced from $138,500 to $100,000. However, the aggregate limit for a graduate student no longer includes the loans borrowed at the undergraduate level. Professional student annual borrowing: Annual Unsubsidized Loan borrowing increased to $50,000. Professional student aggregate lifetime borrowing limit: Reduced from $224,000 to $200,000. However, the aggregate limit for a professional student no longer includes the loans borrowed at the undergraduate level. For a student who at some point will be enrolled as a graduate student and a professional student, the aggregate limit is $200,000. |
Students who had a Federal Direct student loan disburse prior to July 1, 2026 are considered grandfathered/legacy and are not impacted by the Reconciliation Bill's changes. Grandfathered/legacy students have three more years to finish their degree program under their current annual and aggregate borrowing limits. |
| GradPLUS Loan Program | Graduate/professional students could borrow up to the cost of attendance (COA) minus other financial aid; no annual aggregate or lifetime borrowing limits. | Graduate PLUS Loan program for graduate and professional students is eliminated. |
Students who had a Graduate PLUS Loan disburse prior to July 1, 2026 are considered grandfathered/legacy and are not impacted by the Reconciliation Bill's changes. Grandfathered/legacy students have until July 1, 2029 to finish their degree program under the current annual and aggregate borrowing limits. |
| Combined Lifetime Borrowing Limit from All Federal Direct Student Loan Programs | No lifetime borrowing cap across federal direct student loan programs combined. |
A new lifetime limit of $257,500 on total borrowing from all Federal Direct student loans. Parent PLUS loans are excluded from this total for students whose parents borrowed on their behalf. |
Unknown if a legacy provision is applicable for students who borrowed federal student loans prior to July 1, 2026. |
| Parent PLUS Loan Program (between the parents in total) | Parents could borrow up to COA minus other financial aid for their dependent student; no aggregate lifetime borrowing limit. | Parents are limited to annual borrowing of up to $20,000 per dependent student, and are subject to a $65,000 aggregate lifetime borrowing limit per dependent student. |
Students who had a Parent PLUS Loan disburse prior to July 1, 2026 are considered grandfathered/legacy and are not impacted by the Reconciliation Bill's changes. Grandfathered/legacy students have until July 1, 2029 to finish their degree program under the current annual and aggregate borrowing limits. |
| Loan Proration | No systemic loan proration rules existed for students enrolled in less than full time credit hours of enrollment. | Annual loan borrowing limits must be prorated (reduced) if a student demonstrates enrollment of less than full time. This applies to undergraduate, graduate and professional students. | No grandfathering/legacy provision exists. |
| Federal Pell Grant (Eligibility when full COA is covered) | If a student's total financial aid from all sources exceeds their COA, the Pell Grant is not reduced; instead, other forms of aid are adjusted to resolve any overaward, except in rare, limited circumstances where the excess is permitted. | Students receiving grants or scholarships from non-federal sources that cover their entire COA may not be eligible to receive a Pell Grant or the full value of a Pell Grant. | No grandfathering/legacy provision exists. |
Frequently asked questions
Most of the changes go into effect beginning with the 2026-27 school year (as of 7/1/2026), although loan repayment changes have an earlier effective date.
- Annual borrowing limits (Subsidized and Unsubsidized Loans):
- Undergraduate students: No change (Subsidized and Unsubsidized)
- Graduate students: No change (Unsubsidized)
- Professional students: Increased annual limit (Unsubsidized)
- Aggregate borrowing limits:
- Undergraduate students: No change (Subsidized and Unsubsidized)
- Graduate students: Reduced aggregate limit, but will exclude from aggregate any amounts borrowed at the undergraduate level
- Professional students: Increased aggregate limit, and will exclude from aggregate any amount borrowed at the undergraduate level
- Lifetime borrowing limit:
- All students: New lifetime borrowing limit across all federal student loan programs (Subsidized, Unsubsidized, and Graduate PLUS), but excludes Parent PLUS borrowing that occurred on the student's behalf
- Parent PLUS loan limits (loan program for parent(s) of dependent undergraduate students)
- New annual cap of $20,000 per dependent student (combined across all parents borrowing that year for the dependent student; previously no limit other than Title IV cost of attendance minus all other aid offered/received)
- New aggregate limit of $65,000 per dependent student (combined across all parents borrowing Parent PLUS for the student); previously no aggregate limit
- Graduate PLUS loan program eliminated
Yes. A legacy provision does exist for three academic years or the remainder of the student's expected time to credential, whichever is less. Note that the legacy provision does not extend to the proration of annual loan amounts for students enrolled less than full-time.
- Graduate PLUS loan: If a borrower has a Federal Direct Loan made before July 1, 2026, while enrolled in a credentialed program, the borrower can borrow from the Graduate PLUS program for three academic years or the remainder of their expected time to credential, whichever is less.
- Parent PLUS loan: 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 can borrow under current loan limits for three academic years or the remainder of their dependent student's expected time to credential, whichever is less.
- Graduate/professional annual and aggregate loan limits: 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 limits for three academic years or the remainder of their expected time to credential, whichever is less.
- Federal Loan Program lifetime loan limits: 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 three academic years or the remainder of their expected time to credential, whichever is less.
The current and immediate primary option is the private student loan program. VCU will be deploying a historical lender list powered by ELMSelect in early 2026 where students can review a variety of products offered by lenders whom VCU students have borrowed from over the last three school years.
Students may consider applying for available department and donor scholarships through the Ram Scholarship Hub and/or external scholarships. VCU also offers an Installment Payment Plan that allows students to divide the cost of tuition, fees, dining and housing plans into four installment payments throughout the semester.
The National Association of Student Financial Aid Administrators (NASFAA) has created a chart that compares current rules (if any) in comparison to the upcoming changes. Keep in mind that some details are still emerging, including the U.S. Department of Education's intent to publish new regulations around these changes in the law. This chart is subject to change as new guidance or rules emerge.
Need help?
Get in touch with a financial counselor:
- Current students can log in to Navigate to schedule an appointment or call Student Services at (804) 828-1550.
- If you're a prospective student, email sfmc@vcu.edu for assistance.
The Virtual Student Services Center also can help you find answers to a number of questions about tuition and fees, bills and payments, financial aid and more. It features a live chat option and is available 24 hours a day, seven days a week.