Grad PLUS loans for new students eliminated effective July 1, 2026

Mwfan1921
Mon, 07 Jul 2025 11:51:14 +0000

kelsmom:

While it might not seem concerning if mom and dad are willing to co-sign a private loan,

There are some lenders who will lend to grad (and undergrad) students with no co-signer, but the interest rates are high (pushing in to the mid-teens.) I would expect that private education loan interest rates for grad school are going to increase simply because there is less competition since the fed rates are gone (for new borrowers starting in 2026.)

I also think this new Pell requirement is going to be really messy and create some new behaviors in the awarding of financial aid by colleges:

Pell Lifetime Eligibility Usage (LEU): The law retains a previous provision stating that students who receive grants or scholarships covering their entire cost of attendance (COA) would be ineligible to receive a Pell Grant, even if otherwise eligible for the program. However, the law does not include an earlier provision where students would see their Pell Lifetime Eligibility Usage (LEU) reduced as if they had been awarded Pell.

In good news for some families, there’s this FAFSA change:

Asset Exemptions: The law reinstates the exemption of family farm and small business assets from the SAI calculation and expands this asset exemption to family-owned commercial fisheries, with an effective date of July 1, 2026.