One Big Beautiful Bill Act FSA Changes

The One Big Beautiful Bill Act was signed into law on July 4, 2025, resulting in changes to federal student aid.

The information on this page continue to be updated as more information becomes available. Additional updates are available at studentaid.gov.

New York Institute of Technology remains dedicated to supporting students and their families as they adjust to updates in federal financial aid programs and will continue to offer scholarships and grants to help offset educational expenses.

Key Changes to Federal Student Aid

Free Application for Federal Student Aid (FAFSA)

Beginning with the 2026–2027 award year, the follow items will be excluded from the current net worth of businesses and farms, and should not be reported as assets on the FAFSA:

  • The current net worth of family-owned business (with fewer than 100 full-time employees or full-time equivalent).
  • The net worth of farms on which the family resides.
  • The net worth of family-owned-and-controlled commercial fishing business and related expenses.

Federal PELL Grant Eligibility (effective July 1, 2026)

Beginning with the 2026–2027 award year:

  • The foreign earned income exclusion amount reported on the FAFSA will be added to the adjusted gross income when determining Federal PELL grant eligibility.
  • Students who receive non-federal grants or scholarships that cover the full Cost of Attendance will be ineligible for a Federal Pell Grant.
  • Students with a Student Aid Index (SAI) equal to or greater than twice the maximum Federal Pell Grant award amount for the award year will be ineligible for the grant
      • Example: If the maximum Pell grant amount for the 2026–2027 award year is $7,395, and a student has an SAI of 14,790 or more, the student will not be eligible for a Federal Pell Grant.
      • A limited exception applies for dependents of deceased service members and safety officers.

    Reference: 2026–2027 FAFSA Form and PELL Grant Eligibility Updates

    Federal Loans

    Undergraduate Students:

    • New Limits for Parent PLUS Loans: New borrowers will have an annual limit of $20,000 and an aggregate limit of $65,000 per dependent student.
    • Federal Loan Program Lifetime Loan Limits: $257,500 lifetime borrowing limit on all federal student loans, excluding PLUS Loans.
    • Annual Loan Proration: Loan amounts will be prorated based on enrollment status. Less than full-time enrollment equals reduced eligibility. Full-time enrollment for undergraduate students is 12 or more credits.
    • Legacy Provisions: Parents who have a Federal Direct PLUS loan disbursed before July 1, 2026 for their dependent student currently enrolled in a degree-granting program, can continue to borrow PLUS loans under the current loan limits for up to three academic years through July 1, 2029, or until the student completes the degree program, whichever is less.

    Graduate Students:

    • Federal Direct Graduate PLUS Loans will no longer be available to new borrowers starting July 1, 2026.
    • Annual and Aggregate Loan Limits:
      • Graduate Students: $20,500 annual loan limit and $100,000 aggregate limit.
      • Professional Students: $50,000 annual limit and $200,000 aggregate limit.
      • These amounts do not include federal student loan amounts borrowed as an undergraduate student.
    • Annual Loan Proration: Annual Loan Proration: Loan amounts will be prorated based on enrollment status. Less than full-time enrollment equals reduced eligibility. Full-time enrollment for graduate students is nine or more credits.
    • Legacy Provisions: Current students who have a Federal Direct Graduate PLUS Loan disbursed before July 1, 2026, can continue to receive Federal Direct Graduate PLUS loans under the current loan limits until the completion of their current program or for up to three academic years until July 1, 2029, whichever is less.

    Federal Loan Repayment

    New Borrowers with Federal Direct Loans disbursed on or after July 1, 2026:

    • Two repayment options:
      • Standard fixed repayment plan (10–25 years, tiered standard)
      • Repayment Assistance Plan (RAP)
      • All loans must be paid under the same repayment plan
      • Parent PLUS loans can only be repaid under the tiered standard plan

    Current Borrowers with No New Loans disbursed on or after July 1, 2026:

    • Can continue to enroll in the current Standard, Graduated, Extended, ICR, PAYE, and IBR repayment plans
    • May opt into the new RAP or new tiered standard plan when available
    • SAVE, ICR, and PAYE options will be eliminated July 1, 2028; can change, enter, or stay in existing Income Driven Repayment (IDR) plans until July 1, 2028
    • IBR plan will remain available

    Repayment Assistance Plan (RAP):

    • Monthly payment is 1–10% of income based on AGI
    • $50 off monthly payment (base payment) per dependent
    • $10 minimum payment
    • 30-year repayment period
    • No cap on monthly payment
    • No negative amortization
    • Principal match

    FAQs

    Q: Do I qualify for the legacy provisions?

    A: If you are currently enrolled at New York Tech for the Spring 2026 term and received a disbursement of any Federal Direct Student Loan before July 1, 2026, then you qualify for legacy borrowing status for the program you are currently enrolled in for up to an additional 3 years or when you complete your program whichever is less.

    Q. What if I take longer than 3 years to finish my program?

    A. If you are an undergraduate student, after three years, your Parent will be subject to the new PLUS loan annual and aggregate limits. If you are a graduate student, after three years, you will be subject to the new Direct Unsubsidized limits, and you will no longer be able to borrow the Grad PLUS loan.

    Q. I’m a graduate student currently enrolled but I will be attending a different program next fall. Do these changes affect me?

    A. As a graduate student, you will follow the new guidelines because you are starting a new program. You will not be eligible for a Graduate PLUS loan for the new program.

    Q. I’m currently an undergraduate student. What happens if I change my major?

    A. As a continuing student you may be eligible for the legacy provisions if you change your major. The provisions are for up to three years or until you graduate, whichever comes first.

    Q. Will these changes affect my Federal College Work Study?

    A. No. The new law does not change Federal Work-Study eligibility requirements. Work-Study eligibility will continue to be based on financial need as determined by the results of your FAFSA and institutional policies.

    Q. I am starting a graduate program in Fall 2026. What financial aid can I receive?

    A. As a new student, your loan eligibility will be based on the new guidelines. If you are matriculated in a graduate degree program before July 1, 2026, and your loans are disbursed before July 1, 2026, you may qualify for the legacy provisions.

    Be sure to file your FAFSA, if applicable. The Office of Admissions will inform you of any scholarship eligibility. You may be eligible for a Federal Direct Unsubsidized loan. Private educational loans offered by private lending institutions are another option to help you cover education-related expenses. An application and credit-check are required for private education loans.

    Please contact the New York Tech Office of Financial Aid with any questions or concerns.