Major Overhaul in US Graduate Student Lending System
The Trump administration is preparing to launch one of the most substantial reforms to graduate student lending witnessed in over ten years. Starting from July 1, 2026, new federal borrowing limits will become effective, significantly altering how much money students can access and which academic programs qualify for the highest loan amounts.
These changes fundamentally reshape the financial parameters that determine who can pursue graduate and professional studies in the United States, and under what financial conditions. While undergraduate borrowing limits remain unchanged, with dependent students still able to access up to $7,500 annually based on their class level, the major transformations target graduate and professional students.
New Borrowing Limits and Program Classifications
Under the proposed regulations, graduate students will encounter new ceilings: up to $20,500 per year ($100,000 total) for standard graduate study, and up to $50,000 per year ($200,000 total) for programs classified as professional degrees. In a significant shift, Graduate PLUS loans, which previously permitted borrowing up to the full cost of attendance, will be eliminated entirely.
The cornerstone of this reform lies in defining what constitutes a professional degree. The US Department of Education specifies that such a degree represents both completion of academic requirements for beginning professional practice and demonstrates professional skill levels beyond those typically required for a bachelor's degree.
Using this definition, the department has automatically designated eleven fields that qualify for the higher $200,000 borrowing limit:
- Pharmacy (Doctor of Pharmacy)
- Dentistry (Doctor of Dental Surgery or Doctor of Dental Medicine)
- Veterinary medicine (Doctor of Veterinary Medicine)
- Chiropractic (Doctor of Chiropractic or Doctor of Chiropractic Medicine)
- Law (Bachelor of Laws or Juris Doctor)
- Medicine (Doctor of Medicine)
- Optometry (Doctor of Optometry)
- Osteopathic medicine (Doctor of Osteopathic Medicine)
- Podiatry (Doctor of Podiatric Medicine or equivalent titles)
- Theology (Master of Divinity or Master of Hebrew Literature)
- Clinical psychology (Doctor of Psychology or Doctor of Philosophy)
Clinical psychology earned its place on this list following negotiated rulemaking sessions where stakeholders debated how the classification should apply and which fields met the professional practice threshold.
Potential Expansion and Institutional Responsibilities
Beyond these eleven automatically qualifying fields, the department has indicated that at least 44 additional fields could become eligible if they meet specific criteria. These requirements include providing professional-level skills beyond bachelor's degree standards, typically leading to doctoral qualifications, and requiring professional licensure before practice entry.
Potentially qualifying areas encompass other advanced pharmacy programs, clinical counseling, and theological studies. Educational institutions will bear responsibility for determining whether individual programs meet the established standards for professional classification.
Professional Organizations Voice Concerns
The current list has already generated objections from several professional bodies arguing that the department's definition excludes fields that meet rigorous standards and address essential workforce needs.
The American Association of Colleges of Nursing highlighted that nursing, despite being the country's largest health profession and demanding extensive post-baccalaureate training, doesn't qualify under the proposed rules. In their November 7 statement, the organization cautioned that excluding nursing could worsen existing shortages by compelling students toward higher-cost private loans.
The National Association of Social Workers' Florida chapter raised similar concerns on November 20, stating that removing Master of Social Work and Doctorate of Social Work programs from the professional category could diminish affordable training options in a field already dependent on graduate education.
Responding to criticism, the Department of Education clarified in a November 24 fact sheet that the professional degree definition serves as an internal classification used exclusively to determine eligibility for higher borrowing limits. The department emphasized that this definition does not reflect whether a program is professional in nature.
Regulation Objectives and Implementation Timeline
The stated objectives behind the new limits are twofold: discouraging borrowers from accumulating potentially unmanageable debt, and pressuring institutions to control tuition growth by capping federal loan accessibility.
This regulation remains provisional. The Department of Education plans to publish the proposed rule in the Federal Register in coming months, after which the public can submit comments before finalization. For students in the eleven identified degree fields, the higher borrowing limit provides financial clarity. For others, particularly those in graduate credential-requiring fields outside the list, the rule raises concerns about access, costs, and potential institutional adjustments.
As with numerous federal policy shifts, the effects won't materialize immediately. They will gradually emerge in course catalogues, financial aid offices, and program decisions over subsequent years, as universities interpret the new boundaries and students evaluate the costs of entering professions requiring extended training pathways. These new limits represent the initial phase of this financial recalibration.
