It could soon be harder to finance your professional or graduate degree program.
President Donald Trump’s Department of Education concluded its first week of negotiations on its plan to overhaul student-loan repayment on Friday. The discussions centered on Trump’s changes to student loans, which he signed into law in his “big beautiful” spending bill. These included creating new income-driven repayment plans and placing new caps on borrowing.
The latter topic was a central focus of negotiations. The department proposed eliminating the Grad PLUS loan program, which allows graduate and professional students to borrow up to the full cost of attendance. In addition, the department wants to implement new borrowing caps: for graduate students, $20,500 a year and $100,000 over a lifetime; and for professional students, $50,000 a year and $200,000 over a lifetime.
In addition to the caps, the department wrote in its draft text that the higher cap for professional degrees will be limited to 10 programs: pharmacy, dentistry, veterinary medicine, chiropractic, law, medicine, optometry, osteopathic medicine, podiatry, and theology.
Clare McCann, managing director of policy and operations at American University’s Postsecondary Education and Economic Research Center, told Business Insider that the list of programs is based on a current, “non-exhaustive,” definition of a professional degree. Some negotiators expressed concerns with limiting programs that qualify for the higher borrowing cap, and while the department indicated that it would be open to discussing changes to the list, it likely won’t happen during the current round of negotiations.
“At this point, we would like to keep the language where it is,” Tamy Abernathy, the director of policy coordination at the department, said during the Tuesday session. “It’s not an exhaustive list, but it is fixed at this point in time, with the caveat that if it needs to be negotiated at a future date, it would be.”
The department will hold additional negotiation sessions in November to continue discussing the borrowing changes before moving toward the final implementation of the changes in July 2026. The department said the motivation behind these changes is to curb excessive student borrowing, but education experts told Business Insider it could limit financing options for borrowers seeking advanced degrees, either leading them to forgo enrollment or turn to private lending.
“There are some pretty significant reductions in federal borrowing that are going to leave a lot of borrowers needing to find other ways to fill their financing gaps if they want to be able to continue to enroll,” McCann said. “For some people, they may find it’s not possible or not worth it to take on that additional private debt, assuming that colleges don’t simply lower their tuition.”
Graduate and professional degree changes
While negotiators agreed with the intent of curbing excessive borrowing, some were worried that the limits on professional degree programs would be detrimental to those in mental health careers who would not fit into the department’s eligibility for the higher professional borrowing cap.
“There’s a couple thousand schools that offer clinical psychology that will be devastated to hear this, and this is the kind of program that requires about five years of study. And because of the limits involved, it’s virtually impossible to drop below to the graduate level of funding on mental health programs like a doctoral in clinical psychology,” Andy Vaughn, president of Alliant International University, said.
Bennett Boggs, commissioner of the Missouri Department of Higher Education & Workforce Development, added that the list is missing programs like engineering, business, commerce, and education. “There are some professions here that are crucial to our state economic development and workforce development, and this list doesn’t have it, so I’m concerned this is going to really cripple certain aspects of what we’re trying to get done here,” he said.
In response to negotiators’ concerns, the department proposed a new “interim definition” for professional students. This definition allows a student to be considered a professional student if they were enrolled in a program that awards a professional degree before July 1, 2027.
The department’s timeline for implementing these new borrowing caps could also complicate things. McCann said that colleges won’t know the final rules until close to the start of the financial aid awards year, and prospective students might start applying for their programs without knowing how their aid will be structured.
Nicholas Kent, the undersecretary of education, said during remarks at the start of negotiations that the department stands by the changes and its goal to simplify student-loan repayment.
“This is a moment to rise out of a system that has failed too many students for far too long,” Kent said. “It’s a call to reset and strengthen the federal government’s role in helping students finance their higher education and borrowers repay their loans with a system that is simpler, more accountable, and better aligned with the needs of today’s learners, workers, and families.”
