Education Department Clarifies New Authority for Institutions to Set Program-Specific Loan Limits

The U.S. Department of Education has issued new guidance, effective July 1, 2026, allowing educational institutions to establish lower annual loan limits for specific programs. This authority, granted by the One Big Beautiful Bill Act, enables colleges to tailor loan amounts, particularly for professional degrees that may not guarantee high post-graduate earnings. The move aims to provide institutions with more flexibility in managing student debt.