Big Changes Are Coming to Federal Student Loans: What Nurses Need to Know

If you’re a nurse with federal student loans — or planning to an advanced degree — major changes to the federal student loan system are on the way. Beginning July 1, 2026, new limits on borrowing and a streamlined repayment structure will take effect under legislation passed by Congress in 2025.

For nurses, especially those considering graduate school, these updates could significantly impact how much you can borrow — and how long you’ll be paying it back.

Changes Take Effect July 1, 2026

Major changes to the federal student loan system are scheduled to begin on July 1, 2026, following passage of the federal legislative package commonly referred to as the One Big Beautiful Bill Act, which was signed into law in 2025.

The law restructures both borrowing limits and repayment options for new federal student loans. Under the new rules, graduate and professional borrowers will face annual and lifetime borrowing caps instead of the previously uncapped Grad PLUS loan program.

Specifically:

• Graduate students will be limited to $20,500 per year with a $100,000 lifetime cap
• Professional degree programs (such as medicine or law) will have a $50,000 annual cap and $200,000 lifetime limit
• Parent PLUS loans will also face tighter annual and lifetime limits

PBS News explains: “Graduate students will face new annual and lifetime borrowing caps, replacing the current system that allows them to borrow up to the full cost of attendance through Grad PLUS loans.”

Grad PLUS Loans Ending for New Borrowers

The federal Grad PLUS loan program, which previously allowed graduate students to borrow up to the full cost of attendance, will no longer be available to new borrowers after July 1, 2026.

For advanced nursing programs that often exceed six figures in total cost, this change may require alternative funding strategies, including:

• Employer tuition assistance
• Scholarships and grants
• Personal savings
• Private student loans, which may carry higher interest rates and fewer borrower protections

Repayment Options Will Be Reduced to Two Plans

The law also simplifies repayment options for future borrowers with loans first dispersed on or after July 1, 2026 to two options:

• A standard fixed-term repayment plan
• The Repayment Assistance Plan (RAP), which bases payments on income

Existing repayment plans such as SAVE, PAYE, and ICR will sunset or transition over time for current borrowers.

Details about RAP payment calculations and long-term forgiveness timelines are expected to be released by the U.S. Department of Education prior to implementation at StudentAid.gov.

SAVE Plan Transitions Under New Rules

Many nurses are currently enrolled in the Saving on a Valuable Education (SAVE) plan. Under OBBBA, existing income-driven plans like SAVE, PAYE, and ICR will transition over time for pre-July 1, 2026 loans.

Monitor updates at StudentAid.gov for your specific transition guidance, as details vary by loan disbursement date.​

Public Service Loan Forgiveness (PSLF) Remains Important for Nurses

For nurses working in nonprofit hospitals, public health departments, VA systems, or other government employers, Public Service Loan Forgiveness (PSLF) remains a key program.

According to the U.S. Department of Education, “The PSLF Program forgives the remaining balance on your Direct Loans after you’ve made the equivalent of 120 qualifying monthly payments under an accepted repayment plan, and while working full-time for an eligible employer.”

While PSLF itself is not eliminated under the new law, changes to repayment plan availability may affect how future borrowers qualify.

How These Changes Could Affect Nurses

Advanced nursing education is expensive — particularly for CRNA, DNP, and NP programs.

With:

• Lower federal borrowing caps
• Elimination of Grad PLUS loans for new borrowers
• Fewer income-driven repayment options

Nurses may need to plan earlier and more carefully than in the past.

The federal Loan Simulator can help nurses estimate future monthly payments under current and upcoming repayment structures.

What Nurses Should Do Now

Be prepared. Federal student loans are undergoing one of the most significant restructurings in years.

1. Review Your Loans: Log into your account at StudentAid.gov to confirm:
   1. Loan types
   2. Disbursement dates
   3. Current repayment plans
2. Understand the July 1, 2026 Cutoff: Federal loan disbursement dates will determine which borrowing and repayment rules apply.
3. Follow Reputable Updates: stay informed through official guidance from the U.S. Department of Education at StudentAid.gov

It’s important to note that some details of the new student loan rules could still change, as the U.S. Department of Education must complete a formal rulemaking process that includes an open public comment period before final implementation. Borrowers and professional organizations have raised concerns about the proposed changes, and individuals may submit public comments during the designated comment window.

For nurses planning advanced education, the takeaway is clear: know the timeline, understand your options, and plan ahead.

🤔Nurses, what do you think about these changes? Share your thoughts below.