Starting July 1, 2026, part-time federal student loan limits will be prorated based on enrollment levels. This article explains what changes, how proration works, who’s affected, and how students can avoid major financial gaps by acting before the deadline.
If you’re studying part-time or considering it, here’s something you need to know right now: federal student loan rules are changing on July 1, 2026, and it directly affects how much money you can borrow.
Starting that date, your loan limit won’t be the same whether you’re full-time or part-time anymore. Instead, it will depend on exactly how many credits you’re taking. This is called proration, and for millions of part-time students, it’s a significant financial change.
Let me explain what’s happening, why it matters, and what you can do about it.
1. What’s Changing: The Basic Shift
Right now, the system is simple: you can borrow the same annual loan amount regardless of whether you’re full-time or part-time. A part-time graduate student taking 4 credits can borrow $20,500—the same as a full-time student taking 9 credits.
That changes July 1, 2026.
Starting that date, your borrowing limit will be cut to match your enrollment percentage. If you’re enrolled at 50% (half-time), you get 50% of the loan limit. If you’re at 75%, you get 75%. The formula is simple:
Prorated limit = Full annual limit × (Your enrollment percentage)
The concept is straightforward, but the financial impact is real. For more on how the U.S. Department of Education is implementing these changes, you can review official federal student aid guidelines.
2. What Counts as Full-Time?
Before we look at numbers, you need to know what “full-time” means at your school. It determines everything.
For undergraduate students: Full-time = 12 or more credits per semester
For graduate students: Full-time = 9 or more credits per semester
Schools follow Federal Student Aid guidelines when calculating your enrollment percentage. If you’re taking fewer credits than these thresholds, you’re part-time, and proration applies to your loans.
This matters because millions of graduate students study part-time while working. For them, this change is substantial.
3. How Much Can You Actually Borrow?
Here are the real numbers. They vary by program type.
Non-Professional Graduate Programs (Nursing, Engineering, etc.)
Full-time (9+ credits):
- Annual limit: $20,500
- Lifetime limit: $100,000
Half-time (4-5 credits—50% enrollment):
- Annual limit: $10,250 (50% of full)
- Lifetime limit: $100,000
Three-quarter-time (6-7 credits—75% enrollment):
- Annual limit: $15,375 (75% of full)
- Lifetime limit: $100,000
Professional Graduate Programs (Law, Medicine, Dentistry, Pharmacy, etc.)
Professional programs have higher limits, which means the annual gap is larger. According to Harvard Financial Aid Office, these professional program limits have been substantially impacted by recent changes.
Full-time (9+ credits):
- Annual limit: $50,000
- Lifetime limit: $200,000
Half-time (4-5 credits—50% enrollment):
- Annual limit: $25,000 (50% of full)
- Lifetime limit: $200,000
A part-time law student at 50% enrollment loses $25,000 per year. Over a 3-year part-time program, that’s $75,000 less in federal loans.
4. Real-World Examples
Maria: Part-Time Nursing Student
Maria is working full-time while pursuing a master’s in nursing part-time at 50% enrollment.
- Before July 1, 2026: Borrows $20,500/year
- After July 1, 2026: Borrows $10,250/year
- Annual shortfall: $10,250
- 2-year program shortfall: $20,500
Maria now needs to find that $20,500 elsewhere—private loans, personal savings, or additional work.
James: Part-Time Law Student
James is taking a part-time law degree at approximately 55% enrollment.
- Before July 1, 2026: Borrows $50,000/year
- After July 1, 2026: Borrows $27,500/year
- Annual shortfall: $22,500
- 3-year program shortfall: $67,500
That’s a substantial gap for someone already balancing work and school.
These scenarios are real. They’re happening to millions of students right now.
5. The Grandfathering Advantage
Here’s the most important rule: If you receive your first federal loan disbursement BEFORE July 1, 2026, you’re grandfathered in.
This means you can borrow the full annual amount (without proration) for 3 additional years or until your program ends—whichever comes first. No proration penalty.
How to use this:
- Start your program before July 1, 2026 (even one semester counts)
- Get your first loan disbursement by June 30, 2026
- Continue part-time without proration concerns for 3 years
If your 2-year part-time program starts now and you get disbursed by June 30, 2026, you graduate without ever facing proration. You borrow full amounts the entire time.
This window closes in about 6 months. After July 1, 2026, new borrowers don’t get this option.
For comprehensive information about these grandfathering provisions, the Chronicle of Higher Education has extensively covered the implementation timeline.
6. Grad PLUS Loans Are Eliminated
Before July 1, 2026, graduate students could use Grad PLUS loans to borrow beyond regular limits—up to the full cost of attendance with no annual cap.
Starting July 1, 2026, Grad PLUS loans for new borrowers are gone.
You can only borrow the prorated Direct Loan amount. No backup borrowing option exists anymore.
According to Inside Higher Ed, this represents one of the most significant changes to graduate student financing in recent years.
If you’re a graduate student needing more than the prorated limit, you’re now stuck. Private loans become your only option, and they charge higher interest rates.
7. Calculating Your Prorated Limit
The formula is simple. Here’s a step-by-step example:
You’re a graduate student planning to take 6 credits per semester (full-time is 9):
- Your enrollment percentage: 6 ÷ 9 = 0.667 (67%)
- Full annual limit: $20,500
- Your prorated limit: $20,500 × 0.667 = $13,675/year
The Urban Institute has published detailed analysis of how different schools are implementing these calculations. Always contact your financial aid office for your exact enrollment percentage and prorated amount.
8. What You Should Do Now
If you want to start part-time before July 1, 2026:
- Contact schools immediately about enrollment dates
- Start before the deadline if possible
- Get your first loan disbursement locked in
- Avoid proration for your entire program
If you’re planning to start after July 1, 2026:
- Ask your financial aid office for your prorated loan limit
- Understand the gap between part-time and full-time borrowing
- Plan alternative funding sources (private loans, employer assistance, savings)
- Calculate if part-time is financially feasible
If you’re already studying:
- Request a 2026-27 financial aid estimate from your school
- Know your exact prorated limit
- Understand your grandfathering options
9. Professional Programs Are Hit Harder
Professional graduate programs (law, medicine, dentistry, pharmacy) face bigger financial challenges because their limits are higher.
A part-time medical student at 50% enrollment loses $25,000/year. A part-time nursing student loses $10,250/year. Both hurt, but the gap is larger for professionals.
The Pepperdine Graziadio Business School has published detailed guidance on how these changes affect professional MBA programs.
10. Key Points to Remember
Proration starts July 1, 2026. Your annual loan limit will shrink based on your enrollment percentage.
Part-time students lose significant borrowing power. Half-time students lose roughly 50% of annual limits. A part-time law student loses $25,000/year in borrowing capacity.
There’s a 6-month window to act. Get your first loan disbursement before July 1, 2026, and you avoid proration for 3 years.
Grad PLUS loans are gone for new borrowers. You can only borrow the prorated amount with no additional backup.
You need to plan now. The timing of when you start your program matters. Decisions in the next 6 months will affect your borrowing for years.
Contact your financial aid office. Get specific numbers for your program and your 2026-27 eligibility.
For full details, real-life examples, and a comprehensive breakdown of every rule, read our long-form guide:
Part-Time Student Loans Are About to Change: Here’s What Proration Means for You
For complete details on OBBBA changes, read: “Department of Education Professional Degrees: What Changed and What You Need to Know” and “Repayment Assistance Plan (RAP) Explained.”