What the Elimination of Grad PLUS Loans Means for Graduate Students
BIG Ideas:
- On July 1, 2026, Grad PLUS loans will be eliminated for new graduate and professional students due to the One Big Beautiful Bill Act.
- Private student loans could help you meet where federal aid leaves off, but they don’t offer the same protections as federal student loans.
- Scholarships, fellowships, and your college choices can help you lower the cost of grad school.
You know the value of a graduate degree. It can open the door to exciting career opportunities and boost your earning potential. But to get that degree, you’ll need to make a large investment; one that won’t just allow you to attend school but also won’t saddle you with debt years after you finish.
Because the point of getting that advanced degree is to brighten your future, not drain your finances.
So where do you start?
The first step in affording an advanced graduate or professional degree is to apply for financial aid by completing the Free Application for Federal Student Aid (FAFSA). Financial aid could get you grants and student graduate loans that can make college more affordable.
You could also apply for scholarships from non-profits, organizations, and companies that can help you bring down the cost of attendance.
But with the high cost of some graduate and professional degrees, like medical or law school, there may be a gap in funding that you’ll need to fill.
Up until July 4, 2025, when the president signed the One Big Beautiful Bill Act (OBBBA), there was a go-to solution for many students: the Grad PLUS loan. For new graduate and professional students, however, that will soon no longer be an option.
Because OBBBA has resulted in the elimination of Grad PLUS loans, many students pursuing advanced degrees now must solve a big challenge: how to cover the full cost of attendance.
Understanding Grad PLUS Loan Program Elimination
The elimination of Grad PLUS loans will change how students pay for advanced degrees, especially those pursuing higher-cost degrees. To understand how this change could affect you, let’s look at a few key facts about how this graduate student loan program worked and what’s changing.
Here are six facts to know:
FACT 1: The Grad PLUS loan is a federal Direct PLUS loan offered by the U.S. Department of Education to help graduate and professional students attending eligible schools afford the cost of college.
FACT 2: These graduate school loans were designed to cover the gap between your total cost of attendance and the financial aid, scholarships, and savings you already have, allowing you to borrow up to the full cost of attendance.
FACT 3: Beginning July 1, 2026, the Grad PLUS loan program will no longer be available for new graduate and professional students due to OBBBA, putting the Grad PLUS loan elimination in effect.
FACT 4: Students already enrolled in a graduate or professional program may be able to continue borrowing through the program if they took out a federal loan before July 1, 2026, and stay within their expected time to complete their degree.
FACT 5: The OBBBA also introduces new federal borrowing limits or caps on Direct Unsubsidized Loans:
- $20,500 per year and $100,000 total for most graduate programs
- $50,000 per year and $200,000 total for professional programs (like law or medical school)
FACT 6: If you’ve already borrowed a Grad PLUS loan, these changes won’t affect your current loans. You’ll continue repayment under your original terms.
How Grad PLUS Loan Elimination Will Impact You
Now that you know the facts, let’s look at what this change means for your graduate loan options.
If you’re enrolling in a graduate or professional program after July 1, 2026, you may find yourself with a funding gap. One common solution to bridge that gap is a private graduate student loan, a flexible graduate loan option available through banks, credit unions, and non-profit lenders.
There are, however, some important differences you should know about private loans:
- They are based on your creditworthiness and income, not financial need. That means if you have stronger credit, you have a better chance of getting approved. In addition, the stronger your credit, the better the interest rate you’ll receive. If you don’t have strong credit, however, you could get a co-signer.
- Private loan terms, rates, and fees vary by lender, but many private graduate school loans, like those from Brazos, allow you to borrow up to 100% of your school-certified cost of attendance (COA), which makes them a strong graduate loan option, especially for affording higher-priced degrees.
- Unlike federal student loans, private loans may not offer certain protections like income-driven repayment, loan forgiveness programs, or flexible deferment options.
Other Ways to Make Grad School More Affordable
If you’re looking to reduce the cost of your graduate and/or professional degree, you can take some additional steps:
Apply for scholarships: Many organizations offer scholarships based on merit or other factors that can help reduce the amount of money you’ll have to borrow with graduate student loans.
Inquire about fellowships: Many colleges also offer internships and fellowships. Consult with your school to learn about opportunities that may be available to you.
Lower your cost of attendance: One of the best ways to reduce your need for graduate loans is to reduce the amount you have to borrow, whether through a graduate student loan or other financing. Some ways you can accomplish that include:
- choosing a public vs. private school
- working part-time while attending school
- living at home and commuting
- taking advantage of tuition reimbursement at your job
- deferring graduate school until you can save money
Brazos Can Help Make Grad School Affordable
For more than 40 years, Brazos Higher Education has helped students finance the cost of undergraduate and advanced degrees. As a Texas nonprofit, we offer competitive rates on our private student loans that can help you fill the gap where federal aid and your savings leave off. Contact us today.
