Federal Aid Changes for 26/27
Please note that the information provided is based on our current understanding of the OBBBA's implementation by the Department of Education and is subject to change pending final updates, which are expected in the first half of 2026. Once our office receives these final changes, we will update this page accordingly.
The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, contains significant changes for current federal aid (Title IV) programs that will affect how federal funds are disbursed for the 2026-2027 school year and onward.
The OBBBA includes:
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Adjustments to eligibility requirements for the Pell Grant
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Modifications to the Federal Direct Parent PLUS program
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Elimination of the Federal Direct Grad PLUS program for new borrowers
To best support students and their families, the Office of Financial Aid is actively staying informed on these upcoming changes and training its staff to address any needs or questions students may have about their federal aid.
Click on the purple drop downs below to learn more about the upcoming changes.
- Pell Grant Eligibility Changes
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Students whose non-federal aid (institutional scholarships, external scholarships, HOPE Lottery, etc.) fully covers their Cost of Attendance (COA) budget will no longer be eligible for the Federal Pell Grant.
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Example: An undergrad student living on campus with in-state tuition has a COA of $33,656 for the year. If the student receives scholarships and state aid that meets or exceeds the COA, they will not be eligible for Pell.
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Students whose Student Aid Index (SAI) is greater than twice the maximum Pell amount will no longer be eligible for the Federal Pell grant.
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Example: The maximum Pell amount for the 2026-2027 aid year is $7,395. If a student has an SAI greater than 14,790, the student is not eligible for Pell.
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- Undergraduate Direct Student Loan Changes
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New Aggregate loan limit of $257,500 for all federal student loans combined.
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Students who attend less than full-time (24 credit hours total combined from fall and spring) for the year in their program of study (CPOS) will now have their loan amounts reduced.
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Example: An undergrad student enrolls for 10 credit hours in their program for the fall and 12 credits in their program for the spring. Their total credit hours for the year are 22 hours, which is less than 24 credit hours for full-time status. Therefore, the student’s direct loans (subsidized and unsubsidized) will pay out at a reduced rate.
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- Graduate Direct Student Loan Changes
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New Aggregate loan limit of $257,500 for all federal student loans combined.
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Students who attend less than full-time (18 credit hours total combined from fall and spring) for the year in their program of study (CPOS) will now have their loan amounts reduced.
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Example: A grad student enrolls for 6 credit hours in their program for the fall and 9 credits in their program for the spring. Their total credit hours for the year are 15 hours, which is less than 18 credit hours for full-time status. Therefore, the student’s direct loans (unsubsidized and Grad PLUS) will pay out at a reduced rate.
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- Parent PLUS Direct Loan Changes
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New Annual Limit of $20,000 per dependent student (under the age of 24)
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New Aggregate Limit of $65,000 per dependent student
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Legacy Provision: Students with any existing Direct Loan may continue borrowing for up to 3 years or for the remainder of their expected time to complete their program, within the published length of time to do so, whichever is less.
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New Borrowers will need to consider alternative funding such as private loans once loan limits are exceeded. Recommendation: The Office of Financial Aid highly suggests that parents consider requesting a maximum of $16,250 per year in Parent PLUS loans to ensure their student(s) have Parent PLUS eligibility for all four years of school.
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- Graduate PLUS Loan Changes
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The Grad PLUS loan program will be eliminated for borrowers. New graduates will need to consider alternative funding such as private loans.
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Legacy Provision: Students with an existing Grad Plus Loan may continue borrowing for up to 3 years or for the remainder of their expected time to complete the program, within the published length of time to do so, whichever is less.
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If you have any questions about the upcoming financial aid changes, you may contact our office by emailing financialaid@tntech.edu with your specific questions.