One Big Beautiful Bill Changes

Who is affected:

• Students enrolled less than full-time (less than 12 credits)
• Students who withdraw from a course(s) or reduce their enrollment during the academic year

What is changing

• Beginning with the 2026-2027 academic year, Federal Direct Loan amounts will be based on your actual enrollment level for the academic year, rather than assuming full-time enrollment.
• Your annual loan limits will be calculated using the following formula:

Credit hours enrolled for the academic year ÷ Credit hours considered full-time X Annual loan limit (100)

This means students enrolled less than full time may have a lower annual loan limit.

• Example: A dependent first-year student qualifies for $5,500 per year if enrolled full time.
  • The student enrolls in 12 credits (full time) for fall semester
  • After receiving their fall loan, the student withdraws from a 3-credit course, resulting in 9 credits
  • The student enrolls in 12 credits for spring semester
• Total enrolled credits for the year 9 (fall) + 12 (spring) = 21 credits
• Full-time academic year: 12+12=24 credits
• Loan eligibility calculation: 21 ÷ 24 = 88%
• 88% of $5,500 = $4,840 annual loan limit
• Because the student already received $2,750 in fall, their remaining eligibility for spring would be $4,840 – $2,750 = $2,090

What this means for you:

If your enrollment changes during the academic year, your total federal loan eligibility may be adjusted before future disbursements are released. Your financial aid offer will reflect your enrollment level, and adjustments may occur if your enrollment changes.

Contact Ridgewater College Financial Aid if you are considering changing your enrollment and have questions about how it may affect your aid.

Who is affected:

• Students who receive scholarships and grants that fully cover their cost of attendance
• Students who may otherwise qualify for a Federal Pell Grant

What is changing:

1. Higher Income Threshold (SAI Limit): Students whose Student Aid Index (SAI) is equal to or greater than twice the maximum Pell award (about $14,790 for 2026-27) will not be eligible – even if their income is lower. FSA Partner Connect
2. Students with Full Scholarships: If a student has enough non-federal scholarships and grants to cover their entire cost of attendance, they cannot also get a Pell Grant. NAICU
   1. Non-federal aid includes scholarships and grants from sources such as:
      1. Colleges and universities
      2. State grant programs
      3. Private scholarships
      4. Outside organizations
3. Foreign Income Counts for Eligibility: If a family has foreign earned income, it must now be included in calculating eligibility – which can rais the SAI and reduce or eliminate Pell eligibility. FSA Partner Connect

Together, these changes mean some students who previously qualified could lose Pell Grant eligibility.

Who is affected:

• Students who borrow new federal student loans on or after July 1, 2026
• Current borrowers entering repayment in the future
• Existing borrowers may have the option to choose a new repayment plan

What is changing:

• Borrowers who receive new federal student loan disbursements on or after July 1, 2026, will have access to two repayment options:

1. A new standard repayment plan
2. A new income-driven repayment plan, called the Repayment Assistance Plan (RAP)

• These new options are designed to provide structured repayment timelines and a repayment option based on income.
• Repayment options for current borrowers
  • Standard Repayment Plan
  • Graduated Repayment Plan
  • Extended Repayment Plan
  • Income-Based Repayment (IBR) Plan

Current borrowers may also have the option to enroll in the new Repayment Assistance Plan (RAP), if eligible.

What this means for you:

Your repayment options will depend on when you borrow your federal student loans. If you borrow new loans starting July 1, 2026, you will choose from the new repayment plan options. If you already have student loans, you may be able to keep your current repayment plan or choose a new option if it better fits your financial           situation.

Your federal loan servicer will provide detailed information about your available repayment options when you enter repayment.

Student loan servicers will be able to provide the most current information as students enter the repayment process. To determine your loan servicer, sign into your studentaid.gov account here: https://studentaid.gov/manage-loans/repayment/servicers