New Federal Loan Caps for Graduate and Professional Degrees Take Effect July 1
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A new federal policy caps total graduate school loans at $100,000 and loans for 11 professional degrees, including medicine and dentistry, at $200,000. The caps, which replace the previous $138,500 limit, take effect on July 1 and eliminate the Grad PLUS program that allowed borrowing the full cost of attendance. This change may affect access to advanced degrees, particularly in medicine where median tuition far exceeds the new borrowing limits.
Facts First
- New federal loan caps are $100,000 for graduate degrees and $200,000 for 11 professional degrees, including for medical doctors, pharmacists, and dentists.
- The caps take effect on July 1 and replace the previous federal loan limit of $138,500.
- The Grad PLUS loan program is being eliminated; it previously allowed students to borrow the full cost of an advanced degree.
- Median medical school tuition is $298,000 at public schools and over $408,000 at private schools, according to Association of American Medical Colleges (AAMC) data.
- Physician assistants and nurse practitioners fall under the lower graduate degree cap, not the higher professional degree cap.
What Happened
The Trump administration's 2025 tax bill establishes new federal loan caps for students pursuing advanced degrees. The caps are $100,000 total for graduate degree seekers and $200,000 for students in 11 specified professional degree programs, including medical doctors, pharmacists, and dentists. These new limits, which take effect on July 1, replace the previous federal loan cap of $138,500. The policy also eliminates the Grad PLUS loan program, which had allowed students to borrow the full cost of their advanced degree regardless of their field of study. Certain health care professions, such as physician assistants and nurse practitioners, are categorized under the lower graduate degree cap rather than the higher professional degree cap.
Why this Matters to You
If you or a family member are planning to attend graduate or professional school, your ability to finance that education with federal loans will be significantly more limited starting this summer. For aspiring doctors, dentists, and pharmacists, the $200,000 cap may fall short of covering the full cost, as median tuition at four-year public medical schools is $298,000 and exceeds $408,000 at private schools. This could make these careers less accessible without substantial personal savings, scholarships, or private loans. For those who are not eligible for private student loans—a group that includes roughly 40% of Americans and nearly two-thirds of Pell Grant recipients, according to research—pursuing an advanced degree may become more difficult.
What's Next
The new loan caps will be in place for students borrowing for the upcoming academic year. Schools and professional associations are likely to assess the impact on enrollment and may seek to increase scholarship funds or advocate for adjustments to the policy. Students facing a gap between the federal loan caps and the total cost of their program will need to explore other funding sources, which could include private loans, institutional aid, or income-share agreements.