One Big Beautiful Bill Act
One Big Beautiful Bill Act Important Changes
What UHD Students Need to Know for 2026–27 and Beyond
What is the One Big Beautiful Bill Act?
The One Big Beautiful Bill Act (OB3 or OBBBA), signed into law on July 4, 2025, introduces significant reforms to federal student aid programs. The information below reflects the most current guidance available and is subject to change as official guidance is updated and received from the Department of Education.
Changes to the FAFSA and Pell Grants
- Certain assets are no longer counted on the FAFSA:
- Family farms
- Family owned small businesses
- Family owned commercial fishing operations
- Recent federal changes to the FAFSA layout:
- resulted in updates to how applications are processed
- FAFSA applications may experience processing delays
- Pell Grant eligibility is more limited:
- Students whose Student Aid Index (SAI) is too high may no longer qualify
- Students whose scholarships and grants cover the full cost of attendance are not eligible
- Foreign income must now be included when determining Pell eligibility
New Federal Loan Changes and Limits
Part-Time Enrollment and Loan Eligibility (Loan Proration)
- Beginning with the 2026-2027 academic year Federal student loan amounts will be prorated
for students enrolled less than full-time. The amount a student will be eligible to
borrow will be directly proportional to their credit hour enrollment.
- Students taking fewer credit hours than full-time will need to plan borrowing carefully as their loan eligibility may be less than the amount they received in previous years.
Parents of Undergraduate Students
New PLUS Loan Annual and Aggregate (Lifetime) Limits Beginning July 1,2026:
- $20,000 per dependent student, per year (annual limit).
- $65,000 per dependent student, in total (aggregate limit).
Parents may qualify for a limited exception to the new loan limits listed above if they have borrowed a PLUS loan or their student has borrowed a Direct Loan (subsidized or unsubsidized) for the same program before July 1, 2026.
Plan Ahead: The new aggregate limit of $65,000 means that borrowing the annual maximum for a four-year undergraduate program will cause parents to reach the aggregate limit before the student completes their undergraduate degree, leaving them without further access to the Parent PLUS Loan.
Graduate Students
Direct Loan Annual and Aggregate Borrowing Limits
New Graduate Loan Limits Beginning July 1, 2026:
- $20,500 per graduate student, per year (annual limit).
- $100,000 per graduate student, in total (aggregate limit), not including undergraduate borrowing.
Graduate students that qualify for a limited exception will be able to continue to borrow Graduate PLUS loans and be exempt from the new Direct Unsubsidized annual, aggregate, and lifetime limits for the time frames outlined in the legacy provision.
Graduate PLUS Loans
- Starting July 1, 2026, the Graduate PLUS loan program will be eliminated unless students qualify for a limited exception.
Limited Exception to New Borrowing Limits (Legacy Provision)
A legacy provision exists, for a maximum of three years, that allows some students and parents to continue borrowing using the current Direct Loan, PLUS, and Graduate PLUS program annual and aggregate limits.
Graduate students may qualify for the limited exception if:
- The student remains continuously enrolled in the same program of study at UHD through graduation, or up to three years, whichever occurs first AND
- The student borrowed and received Federal Direct Loans (Direct Unsubsidized or Direct Graduate PLUS) before July 1, 2026 in the same program of study.
Parents may be eligible for the limited exception when borrowing a PLUS loan if:
- The student remains continuously enrolled in the same program of study at UHD through graduation, or up to three years, whichever occurs first AND
- The parent borrowed and received a Parent PLUS Loan or the student borrowed and received Federal Direct Loan (Direct Unsubsidized or Direct Graduate PLUS) before July 1, 2026 in the same program of study.
Updates
Please visit Federal Student Aid for latest updates.
The Scholarships and Financial Aid Office will continue to track changes and will update this website as new information or official guidance from the Department of Education becomes available. If you have further questions, please reach out to our office. We appreciate your patience as we navigate these changes!
Office of Scholarships & Financial Aid
One Main Street, Suite S350, Houston, TX 77002
Monday - Thursday: 8 a.m. - 6 p.m., Friday: 8 a.m. - 5 p.m.
uhdfinaid@uhd.edu | 713-221-8041