Parent PLUS loans

The Parent PLUS loan cap: what parents can borrow now

Until this year, a parent could borrow almost the whole cost of college in Parent PLUS loans. That changed on July 1, 2026. There is now a yearly limit and a total limit for each student. Here is what the new rules say, who still gets the old ones, and what it means for the money your family has to find.

The short version

$20,000 a year in Parent PLUS loans for each dependent student.
$65,000 in total for each dependent student, over all the years.
Those limits are for all parents combined. Two parents cannot each borrow $20,000 for the same student.
They apply to Parent PLUS loans from July 1, 2026, so to the 2026-27 school year and to 2027-28, when this year's seniors start college. Some families who were already borrowing keep the old rules for a while (see below).

Before July 1, 2026, a parent could borrow up to the college's full cost of attendance, minus any other aid the student received. For many families that is now a lot less.

How the two limits work

The yearly limit. Each year, a parent can borrow $20,000 or the college's cost of attendance minus the student's other aid, whichever is less. Other aid is subtracted first, then the $20,000 limit applies.

The total limit. Over all of a student's years, parents can borrow at most $65,000 for that student. Three things about this limit surprise families:

Paying the loan off does not give you room back. The law counts every dollar borrowed, even if it was repaid, forgiven or canceled.
It follows the student, not the college. Parent PLUS borrowed for the same student at another college counts toward the same $65,000.
It is reached in year four. Three full years at $20,000 is $60,000, so only $5,000 is left for the fourth year.

A college can also set a lower limit than these for everyone in a program. Ask each college's aid office if it does.

Who keeps the old rules, and for how long

The law has an exception for families who were already in the middle of college. A parent can keep borrowing under the old rules (up to the cost of attendance minus other aid) if, as of June 30, 2026, the student:

was enrolled in a program of study at a college, and
had already received a federal Direct Loan for that program, or a parent had borrowed one for them, before July 1, 2026.

The exception lasts for three academic years, or the time left in the student's program, whichever is shorter. After that, the new limits apply.

What this means for this year's seniors. The Class of 2027 starts college in 2027, so they could not have been enrolled in college on June 30, 2026. Their parents borrow under the new limits from the first year.

Younger brothers and sisters. The exception belongs to each student. A younger child who starts college later is under the new limits, even if a parent still borrows under the old rules for an older sibling.

What it means for your family's gap

Your real cost at a college is its cost of attendance minus grants and scholarships. Loans do not lower that number; they only spread it out. Federal loans can now cover only part of a high real cost, and the rest has to come from savings, income, or a private loan.

Here is an example with made-up round numbers, using the federal limits. Say a college's real cost is $45,000 a year.

Year 1: the student can borrow $5,500 in their own name, and a parent can borrow $20,000. That leaves $19,500 to find.
Years 2 and 3: the student's own limit rises to $6,500, then $7,500. A parent borrows $20,000 each year. The amount left to find is $18,500, then $17,500.
Year 4: the student borrows $7,500, but only $5,000 of Parent PLUS is left under the $65,000 limit. That leaves $32,500 to find, the biggest gap of the four.

Over four years that college costs $180,000. Even borrowing the most federal loans allow ($27,000 for the student and $65,000 for the parents), $88,000 still has to come from somewhere else.

The student's own federal loan limits did not change: $5,500, $6,500, then $7,500 a year, and $31,000 in total for a dependent undergraduate. Hitting the parent limit does not let the student borrow more.

What the loan costs

Interest: 9.07% fixed for Parent PLUS loans first paid out from July 1, 2026 to June 30, 2027. The rate for loans paid out from July 2027 is set each spring, so it is not known yet.
Fee: 4.228% comes off the top of each Parent PLUS loan first paid out before October 1, 2027. On a $10,000 loan, that is $422.80.
Repayment: new Parent PLUS loans can only be repaid on the standard plan, with a fixed monthly payment. The length depends on how much the parent owes in federal Direct Loans in total: 10 years under $25,000, 15 years under $50,000, 20 years under $100,000, and 25 years at $100,000 or more.

What to do now

File the FAFSA. It is the door to grants, which lower your real cost. Loans do not.
Find your real cost at each college on your list, not the sticker price.
Work out the gap after the most federal loans allow, year by year, including year four.
Ask each college about more grant aid, and whether it sets its own lower loan limits.
Only then compare other options, such as savings, a payment plan from the college, or a private loan. A private loan has its own terms; read them in full.

See your own gap, free

The free guide's cost worksheet shows your real cost at each college. Then its "How would you pay for it?" section uses these federal limits for the year your student starts college and shows what federal loans can cover and what your family would still need. No account, and nothing you enter is ever sent to us.

Open the free cost worksheet

Counselors: there is a one-page printable version to hand to families.

Sources, all read on October 13, 2026.

The law: Public Law 119-21 (the 2025 budget law, called the Working Families Tax Cuts Act by the Department of Education). It sets the $20,000 and $65,000 limits "by all parents of that dependent student," the rule that repaid amounts still count, colleges' power to set lower limits, the exception for students already enrolled, and the repayment rules.
U.S. Department of Education, Frequently Asked Questions: Loan Limits (May 20, 2026). The limits per dependent student, other aid subtracted first, borrowing at other colleges counting toward $65,000, who qualifies for the exception, and the unchanged student limits.
U.S. Department of Education, interest rates for loans first disbursed July 1, 2026 to June 30, 2027 (June 4, 2026). The 9.07% Parent PLUS rate.
U.S. Department of Education, loan fees through September 30, 2027 (May 13, 2026). The 4.228% PLUS fee and the $10,000 example.

For your own loan, check studentaid.gov and your college's aid office. This page explains the rules; it is not advice about any one family's loan.

Not starting today? Get the deadlines once a month.

One email a month with the aid deadlines coming up, and a reminder a week before the big ones. The printable FAFSA night handout comes first. The 2027-28 FAFSA is open now.

A mailing list, not an account. It holds your email and nothing else: no tracking pixels, never sold, and never connected to anything a student enters in the guide. One-click unsubscribe on every email. What you get · Past issues

Common questions

What is the Parent PLUS loan limit for 2026-27?

For Parent PLUS loans from July 1, 2026, parents can borrow up to $20,000 a year and $65,000 in total for each dependent student, for all parents combined. The yearly amount also cannot be more than the college's cost of attendance minus the student's other aid. Families who qualify for the exception for students already enrolled keep the old rules for a limited time.

Do the same limits apply in 2027-28?

Yes. The law sets the $20,000 yearly and $65,000 total limits for Parent PLUS loans beginning July 1, 2026, and it does not change them for 2027-28. That is the year the Class of 2027 starts college, so their parents borrow under these limits from the first year. The interest rate for 2027-28 loans is set each spring, so it is not known yet.

Can each parent borrow $20,000?

No. The $20,000 yearly limit and the $65,000 total limit are per dependent student, for all parents combined.

Who can still borrow under the old Parent PLUS rules?

A parent whose student, as of June 30, 2026, was enrolled in a program of study at a college and had already received a federal Direct Loan for that program (or a parent had borrowed one for them) before July 1, 2026. The exception lasts for three academic years or the time left in the program, whichever is shorter. This year's high school seniors start college after that date, so it does not apply to them.

If I pay off my Parent PLUS loan, can I borrow again?

Not under the $65,000 total limit. The law counts every dollar borrowed for that student, even amounts repaid, forgiven or canceled.

Can my student borrow more if we hit the parent limit?

No. The Department of Education says a dependent student cannot get the extra unsubsidized loan amount because their parents reached the $65,000 limit. The student's own limits stay at $5,500, $6,500 and $7,500 a year, and $31,000 in total.

Can Parent PLUS loans made after July 1, 2026 use income-driven repayment?

No. The law requires new Parent PLUS loans to be repaid on the standard plan, a fixed monthly payment over 10 to 25 years depending on how much the parent owes in federal Direct Loans in total.

Reviewed as of October 28, 2026. Federal and state aid rules change; this guide is re-verified on a schedule, but always confirm specifics at studentaid.gov and each college's aid office.