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OB3: Federal Financial Aid Changes

Forms, Resources & FAQs

UNCW is committed to keeping students and families informed about changes to federal financial aid that may affect college planning and affordability. Below is an overview of recent federal legislation and what it may mean for you.

Overview of the New Federal Law

On July 4, 2025, the President signed into law the One Big Beautiful Bill Act (OBBBA), also known as H.R. 1 or the “BBB.” Some colleges and universities may also refer to this as "OB3". This legislation includes several changes that may impact federal student financial aid programs.

UNCW is actively reviewing the law and continues to work closely with guidance from the U.S. Department of Education, as some details are still being finalized at the federal level.

When Will These Changes Take Effect?

Most financial aid ‑related changes included in this law are scheduled to take effect on: July 1, 2026. Some provisions may have different timelines, and UNCW will communicate updates as soon as they are confirmed.

What Areas of Financial Aid May Be Affected?

While not all impacts are fully known yet, the University is paying close attention to changes that may affect:

  • Graduate student borrowing
  • Parent borrowing through federal loan programs
  • Overall federal loan limits

These areas are a priority because they directly affect how students and families pay for college.

We’ll Keep You Updated

The information on this page reflects the most recent federal discussions and proposed guidance. Because some details are still under development, this page will be updated as new information becomes available.

UNCW’s goal is to ensure students and families have clear, timely, and accurate information to support informed financial decisions.

At a Glance: Federal Student Loans Before vs. After July 1, 2026

This table compares key federal student loan rules before and on or after July 1, 2026, including borrowing limits and loan availability for students and parents.

This table compares key federal student loan rules before and on or after July 1, 2026, including borrowing limits and loan availability for students and parents.

Borrower Type or Rule

Before July 1, 2026

On or After July 1, 2026

Undergraduate Students

Direct Subsidized and Unsubsidized Loans available under existing limits

No change to undergraduate Direct Loan limits; loan amounts will be prorated if not full time each semester

Parent PLUS Loans

Parents could borrow up to the full Cost of Attendance with no set cap

Annual limit: $20,000 per student
Lifetime limit: $65,000 per student

Graduate PLUS Loans

Available; allowed borrowing up to full Cost of Attendance

Eliminated for new borrowers

Graduate Direct Unsubsidized Loans

$20,500 annual limit;
$138,500 lifetime limit (included undergraduate loans)

$20,500 annual limit (unchanged);
$100,000 lifetime limit (undergraduate loans excluded)

Professional Degree Students

Often relied on Graduate PLUS Loans

Higher limits: $50,000 annual;
$200,000 lifetime (eligible programs only)*

Lifetime Federal Loan Cap (Students)

No single lifetime borrowing cap

$257,500 lifetime cap on all federal student loans (Parent PLUS excluded)

Enrollment Level Impact

Full annual loan eligibility if enrolled at least half‑time

Loan amounts adjusted proportionally based on enrollment level

School Authority

Institutions generally could not limit federal loans by program

Schools may set lower loan limits by program in limited circumstances

*The bill currently defines professional students as those pursuing a degree in Pharmacy (Pharm.D.), Dentistry (D.D.S. or D.M.D.), Veterinary Medicine (D.V.M.), Chiropractic (D.C. or D.C.M.), Law (L.L.B. or J.D.), Medicine (M.D.), Optometry (O.D.), Osteopathic Medicine (D.O.), Podiatry (D.P.M., D.P., or Pod.D.), Theology (M.Div., or M.H.L.), and Clinical Psychology (Psy.D. or Ph.D.).

Important Exception: Legacy (Grandfathering) Provision

Some students and parents may be able to temporarily continue borrowing under current rules.

You may qualify if:

  • A federal student loan (or Parent PLUS Loan) was borrowed before July 1, 2026, and
  • The student remains continuously enrolled in the same program of study

How long does it last?

  • Generally up to three additional academic years or until the program is completed (whichever comes first)

Changing programs, stopping enrollment, or starting a new degree after July 1, 2026, ends eligibility for this exception.

Alternative Financing Options

We recognize that these changes may present challenges, and we remain fully committed to assisting you in navigating each circumstance. Should you wish to explore alternative financing options, you may consider enrolling in the Teal Pay monthly payment plan or independently researching available non‑federal loan options.

OBBBA (OB3) Frequently Asked Questions (FAQ)

Federal law passed in July 2025—the One Big Beautiful Bill Act—made major changes to federal student loan programs. These changes limit how much students and parents can borrow and eliminate certain loan programs starting July 1, 2026.

No. Loans you have already borrowed are not changed by this law. The changes apply to new borrowing for periods of enrollment beginning on or after July 1, 2026.

No immediate action is required.

Students should:

  • Continue applying for financial aid as usual
  • Begin planning ahead if they expect to borrow loans in 2026–27 or later
  • Monitor updates from UNCW as federal guidance is finalized

Parents who borrow through the Parent PLUS Loan program will face new limits starting July 1, 2026:

  • $20,000 per year per student
  • $65,000 lifetime per student

Parents who borrowed before July 1, 2026, and whose student stays in the same program may qualify for a temporary exception.

  • Graduate PLUS Loans will no longer be available for new borrowers
  • Graduate students will rely primarily on Direct Unsubsidized Loans, which have new lifetime limits
  • Some professional degree programs will have higher loan limits, depending on federal definitions

Graduate students who borrowed before July 1, 2026, and remain in the same program may qualify for a temporary exception.

Loan proration means your loan eligibility is adjusted based on how many credit hours you are taking each semester.

Example:

Students enrolled at half‑time may be eligible to receive only 50% of their annual loan amount.
Full‑time enrollment at UNCW is defined as 12 or more credit hours for undergraduate students and 9 or more credit hours for graduate students.

 

Federal law allows universities to set lower loan limits by program in certain situations. If UNCW adopts any program specific limits, students will be notified clearly and in advance.

This page focuses on borrowing changes. Separate changes to federal loan repayment plans are also expected. UNCW will share repayment related updates as guidance becomes available.