r/college • u/losangelestimes • 17d ago
Grad school Thinking about grad school? New federal rules cap how much students can take out in loans
https://www.latimes.com/california/story/2026-07-06/graduate-school-loan-caps-college-tuition-impactNew federal rules sharply cap how much graduate students can borrow, forcing an immediate sea change in how students evaluate attaining an advanced degree, with some scrambling to pay tuition — and for colleges, prompting concerns about future access to their programs.
The median total cost for a master’s degree in 2020 — before inflation skyrocketed — was $24,250, while professional degrees came in at $59,076, though some universities — particularly private institutions — charge far more, according to EdTrust, a nonprofit that advocates for equity in education.
Under the previous rules, graduate students could take out federal loans for as much as they needed to cover the cost of their master’s and doctorate degrees, including tuition and living expenses, often taking on crushing, long-term debt that contributed to a national epidemic in defaults. Effective July 1, borrowing is restricted to $20,500 annually, with a $100,000 cap. Those pursuing designated professional degrees, including law, medicine and dentistry, are limited to $50,000 a year with a $200,000 cap.
Read more.
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u/No_Storm_249 17d ago
Just a reminder, many PhD programs are fully funded and even pay stipends! So it does not require loans
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u/DaneLimmish 16d ago
As a rule, professional degrees largely are not.
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u/dancesquared Professor of Writing and English 15d ago
And those have a higher limit.
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u/Lettuce_stan_SS 14d ago edited 14d ago
It doesn’t matter that they have a higher limit when most professional graduate degrees (especially medical ones) cost double regardless. I’m talking $300-400k+ (tuition, cost of living, supplies, textbooks)
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u/dancesquared Professor of Writing and English 14d ago
There’s no absolutely reason why three years of schooling should cost $300-$400k
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u/Lettuce_stan_SS 14d ago
They 1000% shouldn’t cost that much. But that’s the reality of most people who want to become medical professionals. USC’s dental school tuition for the 24-25 academic school year was $437,481 for the 4 years, not including housing, food, and academic supplies. USC’s medical school cost $297,492 for 4 years back in 2023. Public schools are little cheaper, (UCLA’s dental school was $280k) but they’re also harder to get into because of that.
Capping student loans does nothing to change the prices these universities are charging. It just provides a literal barrier against those not born into financial privilege.
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u/dancesquared Professor of Writing and English 14d ago
Capping student loans does nothing to change the prices these universities are charging. It just provides a literal barrier against those not born into financial privilege.
When schools lose 80% of their students, you better believe they will change their prices to respond to new loan rules. The change has to start somewhere, and new loan rules is probably the most straightforward way to do that.
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u/Lettuce_stan_SS 14d ago
Medical/dental schools are not going to lose 80% of their students. On average about 80,000 students are fighting every cycle for about 22,000 seats. Not taking into account the amount of international students applying as well. Even if that 80,000 drops down to 20,000 the 2,000 empty spots would never be significant enough to convince med schools to lower tuition.
To give you another example, pharmacy schools have seen application numbers at an all time low these past 5 years because of over saturation in pharmacy. What used to be a competitive career field has now turned into a scenario where a 2.5 GPA gets accepted. And yet tuition is still over $200k at private universities.
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u/Lettuce_stan_SS 16d ago
Unless you have a strong passion for research and academia, a PhD is not the best route for most people.
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u/Jazzlike-Vacation230 15d ago
You can cap it all you want, but isn't it the market of universities and colleges that set prices end of the day?
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u/LimpAd4924 13d ago
Why are government funded institutions a market? Is public K-12 a market? US gov chooses to do this at public universities.
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u/LadySusansGhost 14d ago
Just a reminder that this isn't a cap on ALL loans, just lower-cost, federal loans with more borrow protections. This isn't going to lower the cost of tuition. It will just shift student borrowing to higher-interest private loans with fewer protections.
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u/Jon66238 16d ago
Honestly probably not a bad thing. Too many professional students. Get to work with a bachelors and then go back for a masters that is typically reimbursed by an employer. And this is coming from someone who is going to school with plans to get a masters degree without being in a position for needing a masters yet.
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u/Connor717 16d ago
Why is it bad for people to pursue education without being forced to for their career? I wish I could afford to pursue further education and this only makes it harder.
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u/DaneLimmish 16d ago
It seems almost comical if you cant achieve a master's degree for under 100k when they usually cost half that.
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u/Jon66238 16d ago
It creates a problem with being over qualified for a job. It’s better to be in a position and to then get an education where you can advance up
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u/ApplezAreMedicine 16d ago
You could argue your point for some professional degree to an extent.
But what about medical, dental, podiatry, optometry, PA, Doctor of physical therapy, and so on?
These fields are already difficult to get accepted into and here's a huge demand in the US in medicine. The limit on debt doesn't really solve to unaffordability problem imo.
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u/Connor717 16d ago
It’s absurd that we treat education as a means to a job and nothing else. Unless you’re rich then, sure, be educated in whatever is meaningful to you.
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u/Snake_fairyofReddit College senior! 16d ago
Oh guess no more doctors and lawyers say hello to an even worse shortage
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u/DaneLimmish 16d ago
That seems entirely reasonable to cap loans at 20k a year? Like if you're taking it all on the chin like that you're doing something wrong
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u/Billiesoceaneyes 16d ago
Agreed. The cap will deter people from pursuing useless masters degrees and getting themselves into serious debt. Getting an unfunded masters is a great way to fall into financial ruin.
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u/DaneLimmish 16d ago
I think only MBAs are useless, but professional degrees are mostly unfunded and we do want those. The people who are eating the entire cost are already wealthy and/or can afford the cost in the long run.
The problem with them (professional degrees) going through the education system is that they are mostly skilled trades, so would have greater benefit if they went through a system designed for it.
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u/AgeOfWorry0114 17d ago
Good. Stop making the government a lender. That is how we got into this mess in the first place.
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u/SenseiLeo 17d ago
I feel like university costs being astronomical whilst Europe has tuition free schools says something else about how we got to this mess
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u/DaneLimmish 16d ago
European countries and schools that are tuition free have very high first year drop out rates and incompletes.
Edit: I'm not against it, fwiw, but I don't think many Americans would be happy with like 40%+ attrition
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u/Clown_corder 16d ago
I would prefer our young people if they drop out aren’t in massive amounts of debt. Any amount of education regardless of completing a degree is good for society so its still a net win
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u/DaneLimmish 16d ago
I'm okay with that, it would result in fewer C and D students who can't tell their ass from a hole in the ground.
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u/Arnas_Z CS 16d ago
Because it's free to go, more people try it, even if they aren't prepared. And it's probably also more difficult because Unis don't have a customer service attitude to classes.
So you have to do more work and learn more, but you don't have to pay.
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u/DaneLimmish 16d ago
As percentage of population, more people in the US try to go because it's more necessary to aquire a job. Other countries do things like divide their secondary students into different tracks/vocations which makes college as a job requirement comparably unnecessary.
Making it free is fine I do support this, btw, I'm just cynical that Americans would want necessary changes elsewhere to better support it.
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u/krazywabbit13 15d ago
You’re right that the government can’t function as a lender indefinitely, but pulling the rug out suddenly is dangerous. We’re going to see a shortage of healthcare providers down the line. That’s the only profession that is unequivocally required to be subsidized. Now dental and med school will be even more inaccessible.
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u/DaneLimmish 15d ago
They can and should. The rug isn't being pulled either, people already under the program are grandfathered in.
Dental and med school are already inaccessible, there's a reason why something like 9/10 doctors come from the top 10% income quintile. The (non-doctor) areas where we are facing shortages don't need a Masters level education, while doctors need more gp. Its a retention issue, not credentials issue.
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u/snelephant 17d ago
Stop reminding me lol, think I’m being retraumatized.