New Rules for Federal Student Loans | Episode 067

In this Fourth of July weekend episode, Mark highlights federal student-loan changes tied to the One Big Beautiful Bill Act (OB3) which go into effect as of July 1, 2026.

He notes a new auto-pay incentive: as of July 1st, borrowers on auto payment receive a 1.00% interest-rate reduction (up from 0.25%), effective automatically for those already enrolled, with a Sept. 30 enrollment deadline for others.

He reviews the new loan rates for loans disbursed between July 1, 2026 and July 1, 2027 and the unchanged loan origination fee. Undergraduate annual and lifetime borrowing limits remain the same, while Parent PLUS loans are now capped at $20,000 per year and $65,000 lifetime per student. New caps for graduate students go into effect as well: $100,000 (for non-professionals) and $200,000 (for professionals).

He also outlines the RAP repayment approach based on AGI and emphasizes that balances won’t grow due to negative amortization under the new rules.

Episode Links:

Mark’s Money Mind YouTube Channel

OBBBA Federal Student Loan Updates FAQ

Federal Student Aid official website

Direct Subsidized and Direct Unsubsidized Loans

Federal Student Loan Repayment Plans

Timestamps:

00:00 Holiday Show Intro