PLUS Loan Changes in 2026: What Borrowers Need to Know

What Are PLUS Loans?

PLUS loans are federal student loans available to two groups: graduate or professional students, and parents of dependent undergraduate students. They've historically allowed borrowers to cover the full cost of attendance at an eligible school—minus any other financial aid—making them a go-to option when other federal loan limits fall short.

Unlike most other federal student loans, PLUS loans require a credit check. The Department of Education doesn't review your credit score, but it does screen for adverse credit history, including bankruptcy, foreclosure, debt in collections and loan default.

What Is a Graduate PLUS Loan?

A graduate PLUS loan is a federal loan for students enrolled in a graduate or professional degree program. It has historically allowed eligible borrowers to cover the full cost of attendance with only a basic credit check required.

Graduate PLUS loans have been eligible for all federal income-driven repayment (IDR) plans and Public Service Loan Forgiveness (PSLF).

What Is a Parent PLUS Loan?

A parent PLUS loan is a federal loan that a biological or adoptive parent (or in some cases a stepparent) can take out to help cover the cost of a dependent child's undergraduate education.

Like graduate PLUS loans, parent PLUS loans have historically allowed parents to borrow up to the cost of attendance, minus any financial aid the student receives. Repayment typically begins immediately, though parents can request a deferment while the student is enrolled.

Learn more: What's the Difference Between Student Loan Deferment and Forbearance?

How Are PLUS Loans Changing?

Starting July 1, 2026, both graduate PLUS and parent PLUS loans will look very different for new borrowers.

Grad PLUS Loans

New borrowers enrolling after July 1, 2026, will no longer have access to graduate PLUS loans. Additionally, federal borrowing for graduate students will be limited to direct unsubsidized loans, subject to new caps.

For non-professional programs, the cap is $20,500 per year and $100,000 in total. For professional students—think medicine, law, dentistry and similar fields—it's up to $50,000 per year and up to $200,000 in total.

Parent PLUS Loans

Parent PLUS loans are being capped. Parents who are new to the program after July 1, 2026, will face limits that didn't previously exist. More specifically, loans will be capped annually at $20,000 per student, and there's a lifetime cap of $65,000 per student.

How to Prepare Your Credit for PLUS Loan Changes

With more limitations coming for graduate and professional students and parents, you may need to use private student loans to bridge the gap.

Private student loans rely heavily on your credit profile to determine eligibility and interest rates. Most private lenders require a credit score in the upper-600s or higher, and the higher your score, the better the rate you're likely to receive. Here are steps to strengthen your credit now.

1. Check Your Credit Report and Score

You can check your credit scores for free with Experian and review your credit report for errors. If you find inaccurate information, you have the right to dispute it. You can also look for other problem areas that you can address to improve your credit over time.

2. Pay Every Bill on Time

Payment history accounts for 35% of your FICO^® Score^Θ, making it the most important factor. Even one missed payment reported 30 or more days late can significantly lower your scores. Setting up autopay for at least the minimum due on every account is one of the most reliable ways to protect your credit.

3. Pay Down Credit Card Debt

Credit utilization, which measures how much of your available credit you're using, accounts for 30% of your FICO^® Score. Paying down credit card balances can have a noticeable impact quickly. Aim to keep utilization below 30%, and ideally below 10% for the best possible score.

4. Limit New Credit Applications

Each new credit application generates a hard inquiry on your report, which can temporarily lower your score. If you plan to apply for a private student loan soon, hold off on applying for new credit cards or loans in the meantime.

5. Try Experian Boost^®ø

If your credit history is thin, Experian Boost could help. The free feature lets you add on-time rent, utility, phone, insurance and streaming payments to your Experian credit file, which could raise your FICO^® Score based on Experian data right away.

Learn more: How to Pay for College When Financial Aid Isn't Enough

What if You Already Have PLUS Loans?

Your existing PLUS loan balances won't be affected by the new rules. In fact, the OBBBA includes legacy provisions that allow qualifying borrowers to continue accessing PLUS loans under the old limits temporarily.

Direct PLUS Loans

If you received any federal direct loan before July 1, 2026, while enrolled in your current program, you may continue borrowing graduate PLUS loans for up to three additional academic years, or until you complete your program, whichever comes first.

You have to remain continuously enrolled in the same program, though. Taking a leave of absence or transferring to a new program can disqualify you from the legacy provision.

Parent PLUS Loans

If you or your child had any federal direct loan disbursed before July 1, 2026, you may continue borrowing parent PLUS loans under the old limits for up to three more years or until the student finishes their current program, whichever comes first.

Also, parent PLUS loans don't qualify for IDR directly, but borrowers can consolidate into a direct consolidation loan to gain access. The OBBBA sets a hard deadline on that option: Your consolidation must be disbursed before July 1, 2026.

Once consolidated, you'll need to enroll in an IDR plan and make at least one qualifying payment before July 1, 2028, to preserve long-term access, including any path to loan forgiveness.

Be aware: If you take out a new parent PLUS loan on or after July 1, 2026, all of your parent PLUS loans—including previously consolidated ones—will lose IDR eligibility. New loans after that date are locked into the standard repayment plan only.

Frequently Asked Questions

Know Where Your Credit Stands

Whether you're planning to borrow privately for graduate school or managing repayment as an existing PLUS loan holder, your credit score plays a central role in your options. You can monitor your credit for free with Experian and get personalized tips to improve it, so when it's time to borrow, you're in the best position possible.