EPISODE RESOURCES

Finalized DOE Student Loan Rules: New Caps, Repayment Assistance Plan, and Default Rehab Changes (Effective 2026–2027)

In this episode we share newly finalized Department of Education regulations tied to the Working Families Tax Cuts Act and explain how they may affect student loan borrowers starting in 2026–2027. We outline new federal loan caps beginning July 1, 2026: graduate loans limited to $20,500 annually/$100,000 total; professional programs (11 fields including law, medicine, dentistry, and clinical psychology) to $50,000 annually/$200,000 total; and Parent PLUS capped at $20,000 annually/$65,000 per dependent, plus a $257,500 lifetime limit for new borrowers. We also cover repayment changes including a new Repayment Assistance Plan becoming the only income-driven option for first-time borrowers after July 1, 2026, a tiered 10–25 year standard plan, expanded loan rehabilitation to twice per loan with IDR opt-in at agreement signing, revised forbearance limits, sunsetting certain deferments for loans after July 1, 2027, and new institutional and part-time borrowing rules, warning current borrowers to be cautious about taking new loans.

00:00 Student Loan Rule Update
00:08 Podcast Intro and Context
01:21 Personal IRS Refund Story
02:02 New DOE Regulations Overview
02:50 Graduate and Professional Loan Caps
05:19 Parent PLUS Limits Explained
07:36 Lifetime Borrowing Cap
08:20 New Repayment Plan Changes
09:43 Tiered Standard Repayment
11:07 Default Loan Rehabilitation Updates
13:30 Forbearance and Deferment Changes
14:27 School and Part Time Loan Limits
15:41 Key Takeaways and Wrap Up