Loan reforms

Section 455 of the Higher Education Act of 1965 (20 U.S.C. 1087e) is amended—(1)in subsection (a)—(A)in paragraph (3)(A)—(i)in the matter preceding clause (i), by striking part B and inserting part B—;(ii)beginning in the matter preceding clause (i), by striking for any period and all that follows through professional student and inserting the following:

(i)for any period of instruction beginning on or after July 1, 2012, a graduate or professional student

; and

(iii)in clause (ii), by inserting for any period of instruction beginning on July 1, 2012 and ending on June 30, 2024 (subject to paragraph (4)(C)), before the maximum annual; and(B)by adding at the end the following:

(4)

Graduate and professional annual and aggregate limits for Unsubsidized Stafford loans beginning July 1, 2024

(A)

Annual limits beginning July 1, 2024

Subject to subparagraph (C), beginning on July 1, 2024, the maximum annual amount of Federal Direct Unsubsidized Stafford loans—(i)a graduate student, who is not a professional student, may borrow in any academic year (as defined in section 481(a)(2)) or its equivalent shall be $20,500; and(ii)a professional student may borrow in any academic year (as defined in section 481(a)(2)) or its equivalent shall be $40,500.(B)

Aggregate limits beginning july 1, 2024

Subject to subparagraph (C), beginning on July 1, 2024, the maximum aggregate amount of Federal Direct Unsubsidized Stafford loans—(i)a graduate student, who is not a professional student, may borrow is $65,000, in addition to the amount borrowed for undergraduate education; and(ii)a professional student may borrow is $130,000, in addition to the amount borrowed for undergraduate education.(C)

Phase out provisions

Notwithstanding the date of the applicability of the limits set forth in this paragraph, an eligible graduate student, including a professional student, who received a disbursement of a Federal Direct Unsubsidized Stafford loan after June 30, 2023, and before July 1, 2024, for the 2023–2024 award year, may receive a Federal Direct Unsubsidized Stafford loan for the 2024–2025 award year in amounts that are subject to the annual and aggregate loan limits applicable prior to July 1, 2024, if the borrower did not graduate prior to the 2024–2025 award year.(D)

Definitions

In this paragraph:(i)

Graduate student

The term graduate student means a student enrolled in a program at the postbaccalaureate level, such as a postbaccalaureate certificate, a master’s degree, or a doctor’s degree.(ii)

Professional student

The term professional student means a student enrolled in a doctor’s degree-professional practice program. (iii)

Postbaccalaureate certificate; master's degree; doctor's degree; doctor's degree professional-practice

The terms postbaccalaureate certificate, master’s degree, doctor’s degree, and doctor’s degree professional-practice shall have the meaning provided in the 2022–2023 glossary of the Integrated Postsecondary Education Data System (OMB NO. 1859–0582 v. 30). (5)

Termination of authority to make Federal Direct PLUS loans to graduate and professional students

(A)

In general

Notwithstanding any other provision of law, for any period of instruction beginning on or after July 1, 2024, a graduate student (including a professional student) shall not be eligible to receive a Federal Direct PLUS Loan under this part for enrollment in a program of graduate or doctor's degree professional-practice education.(B)

Phase out provisions

Not later than 30 days after the date of enactment of the

Graduate Opportunity and Affordable Loans Act

, each institution of higher education that enrolls graduate students or professional students shall notify prospective and enrolled graduate students and professional students that the Federal Direct PLUS Loan program will end for graduate students and professional students on June 30, 2024.(C)

Definitions

The definitions in paragraph (4)(D) shall apply to this paragraph.(6)

Institutionally-determined limits

Notwithstanding any other provision of this part, an eligible institution (at the discretion of a financial aid administrator at the institution) may prorate or limit the amount of a loan a student who is enrolled in a program of study at that institution for a period of instruction beginning on or after July 1, 2024, may borrow under this part for an academic year, as long as any proration or limit is applied consistently to all borrowers entering such program of study.