Students hoping to borrow more for graduate degrees in nursing and other fields were handed at least a short-term victory in late June, when a judge’s order prompted the Education Department to temporarily expand its list of “professional” degrees that qualify for higher federal loan limits.
But the order also created a dilemma for students and colleges.
That’s because they have no idea whether or when the list may shrink again. And it’s unclear what the Trump administration would do if loan caps for certain degrees dropped partway through the academic year, after higher loan amounts had already been disbursed.
Incoming grad students are left wondering whether they should take advantage of the access to more federal loans while they can. Colleges are debating whether they should even offer it.
“This is a very challenging time for students to face uncertainty in their financing options,” says Peter Granville, a fellow at The Century Foundation, a left-leaning think tank, who researches college access and affordability. “By July, they’ve typically committed to their programs, but they may not yet know for sure how they’re going to pay for their tuition and their living costs. This may feel like an 11th-hour plot twist, but the plot isn’t over yet. It’s important for them to know that this situation is still fluid.”
Here’s a look at what you should know about where the loan limits stand and what could happen in the future.
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What Are the Graduate Loan Limits and Why Did the Court Take Issue With Them?
As part of the , the Trump administration is capping the amount that graduate students can borrow from the federal government. In past years, students could borrow up to the total cost of attendance by taking out what are known as Grad PLUS loans, but that program has been eliminated for new students as of July 1.
Instead, most grad students are now limited to $100,000 total in federal loans, with an annual cap of $20,500. However, students pursuing “professional” degrees are eligible for higher limits, with an aggregate ceiling of $200,000 and an annual cap of $50,000.
The Education Department initially listed 11 programs that it deemed to be “professional,” omitting some high-demand, high-cost programs such as nursing. Industry groups sued the administration over the narrow definition, arguing in part that it could worsen the health care workforce shortage in some areas. That lawsuit led U.S. District Judge Beryl Howell to block the new definition, saying that the department likely exceeded its authority by adding “more stringent requirements” for degrees to qualify as professional.
The Trump administration responded by removing the additional criteria and , while emphasizing that the new list is temporary and saying it will continue to defend its initial list in court. The degrees that were added are primarily in health care fields. They include nursing, physical therapy and audiology. Theology, which was given professional status in the initial list, was dropped from the new list.
The court case is ongoing, and it’s possible that a further ruling or an action by Congress could result in the list of professional degrees narrowing once again.
A is also still pending.
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Will Colleges Actually Let You Borrow More in the Interim?
That depends on your college. Schools have essentially three options.
They could reach out to students to inform them that they’re now eligible for higher loan limits and ask if they want to take out more loans. They could opt to wait for individual students to inquire about the higher limits and then offer more loans in those cases. Or they could keep the lower caps in place and decline to offer the higher limits.
The third option only became available to colleges this year through a that allows schools to set program-level borrowing limits at their discretion, as long as the cap applies equally to all students in the program. In the past, colleges were required to adhere to federal limits.
In a message to student loan administrators that accompanied the updated professional degree list, the Education Department suggested that institutions take advantage of that option while the rule plays out in court.
“Institutions may wish to consider … limiting loan amounts to the graduate-level caps to mitigate potential disruption to student borrowers resulting from changes in program classification that may arise from the ongoing litigation,” the department wrote.
“Colleges will have to read the tea leaves to decide whether it’s best to approve loan increases or use their authority to maintain the prior limits,” says Granville.
Marguerite Lane, vice president of enrollment management at Molloy University, says the school would allow students to borrow the higher limits if they request to. However, she says a financial aid administrator would explain to the student the risks involved in borrowing a higher amount now and how doing so could impact their eligibility for future loans if limits drop.
“We do not want students to come into a program that they’re not going to be able to afford to finish,” says Lane. “That’s not the goal. So we want to be as transparent as possible.”
A private university on Long Island, New York, known for its nursing programs, Molloy likely wouldn’t have a high number of students seeking higher annual loan limits, Lane says. That’s because many of its nursing graduate students attend part time while working, and tuition is relatively low compared with other nursing programs. Still, many would hit the aggregate limit over time if it ends up being capped at $100,000, she says.
Emory University, which boasts , is navigating the uncertainty with caution, says John Leach, the university’s vice provost for enrollment, student financial services and registration.
“We are taking a wait-and-see approach,” says Leach, who notes that the school is following the court proceedings closely. “The guidance from the Department of Education has been that they will appeal and they expect to win on the merits of their appeal, so schools should take that into consideration if we decide to award students at the higher — professional — amounts.”
Jill Desjean, director of policy analysis at the National Association of Student Financial Aid Administrators, says her organization has been advising schools to meet with their legal counsel to determine how they should navigate the uncertainty and to make sure they understand the potential risks involved in offering larger loans.
“While they can offer these higher $50,000 annual limits to the students who are covered under this temporary expansion, it may not be the best thing for students,” says Desjean. “There are really negative implications to people borrowing that $50,000 loan if the courts ultimately side with the Department of Education and go back to that original definition and say these people can’t get those loans.”
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What Happens if Your Loan Limit Drops After You Borrow?
Colleges don’t know what would happen if loan caps drop after larger amounts have been disbursed, and administrators are left to speculate as to what actions the Education Department might take if courts rule in its favor, allowing it to retrim its list of degrees that qualify for higher limits.
The Education Department didn’t respond to a U.S. 小萝莉影视 request seeking details on how it would handle loans disbursed above the reinstituted caps.
Let’s look at a potential scenario and how it might play out. Say a student begins their nursing program this fall and opts to take out the annual maximum professional loan of $50,000. The college disburses half that amount, $25,000, in the first semester. Then, a court ruling allows the Education Department to lower nursing caps back down to the annual graduate limit of $20,500. That student has now exceeded their yearly borrowing cap, and they still have another semester to go. What happens?
Here are three possible outcomes:
— Students are grandfathered in to the higher limits. This would be the preferred solution for most students and schools. In this scenario, if a student begins school with higher borrowing limits, they can keep those limits, at least through the end of the academic year. There would be a question of whether the grandfathering applies to a student’s aggregate limit as well. This would be similar to how the Trump administration allowed graduate students who were caught in the middle of the federal student loan overhaul to continue in the Grad PLUS loan program until they complete their studies.
— Disbursements are halted. This is perhaps the most likely outcome. In this case, the student who already exceeded their limit in the first semester would be ruled to have hit their annual maximum and would not be eligible for federal loans in the second semester. To continue their studies without disruption, a student would need to pay out of pocket or get a private loan. That student could borrow again when their annual limit resets the next academic year.
— The government asks for money back. Experts call this a worst-case scenario, where schools would be asked to return any funds that exceeded the lower caps. A student may in turn have to repay the school, depending on how the situation is handled.
For degrees such as theology, which were actually removed from professional status when the list was expanded, colleges don’t have to return disbursements already made, the Education Department wrote. However, schools can’t make any future disbursements to those students at the higher limit.
What Else Should Students Watch Out for if They Borrow More?
Federal student loans have benefits and protections that generally make them more appealing than private options. However, here are some factors students may want to consider before taking out sizable loans in their first year of grad school.
— Aggregate limits. Students who borrow large sums in their first year could risk hitting a funding wall later on if their aggregate borrowing limit drops due to a change in “professional” degree classification.
— Accruing interest. Your federal graduate student loans begin accruing interest right when they’re disbursed. So borrowing $50,000 in Year One means your debt will grow more aggressively during college unless you plan to make payments while enrolled.
— Qualification for private loans. Research suggests about for private student loans. If you think you may need private student loans to bridge a funding gap, it might be a good idea to check with private lenders early on to confirm that you’d be eligible for one.
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