2026-2027 Financial Aid Updates

Parent PLUS Loan Annual & Lifetime Limits

• First-time Parent PLUS loan borrowers have new annual and lifetime loan limits.
• Parents may borrow $20,000 per year per dependent student and a $65,000 lifetime limit per dependent student. A maximum of $20,000 is allowed for PLUS loans in one year per dependent student.
• Legacy Provision: If the student or parent borrower has a Federal Direct Loan made before July 1, 2026, and the student stays enrolled in the same program, the parent may continue using the current (higher) Parent PLUS loan limits for up to the shorter of either three academic years or the remaining length of the student’s program based on what they have already completed. Please note, a change of major does not necessarily mean the student changed programs. If a student doesn’t attend for a semester (not counting summer), the parent loses eligibility for this legacy provision. If legacy is lost, any Parent PLUS loan borrowed previously counts against the $65,000 lifetime dependent student limit. Once this limit is reached, Parent PLUS loans are no longer able to be borrowed.

Borrowing Examples – $20,000 annual maximum and $65,000 lifetime limit

• Parent borrows $65,000 over four years equals $16,250 per year.
• Parent borrows annual max of $20,000. $20,000 would be borrowed for years 1 through 3, and $5,000 for year 4.
• Parent borrows annual max of $20,000 for the first two years and would have $12,500 remaining for year 3 and 4 each.
• Parent borrows $65,000 over five years equals $13,000 per year.

Effective with the 2026-27 academic year, student loan borrowers enrolled less than full-time will have their loan amount recalculated to reflect actual enrolled hours. Any classes that are dropped after disbursement in one semester will impact a subsequent loan amount in the same academic year. UWM’s next academic year includes Fall 2026, Spring 2027, and Summer 2027.

Recalculation Formula

Number of credit hours enrolled for the academic year divided by Number of credit hours considered full-time times the Annual Loan Limit.

Recalculation Examples

Student Enrolled Part-Time

• Full-time for a UWM undergraduate student is 12 credits per fall/spring term (24 credits per academic year).
• An undergraduate student enrolled in 6 credits in the fall and 6 credits in the spring is 50% enrolled in each term.
• Their loan will be recalculated to 50% of their annual eligibility.
  • If the student is a dependent freshman student, their annual full-time eligibility is $5,500, so their recalculated annual amount would be $2,750 ($1,375 per semester) to reflect their half-time enrollment for the fall and the spring.
  • If the student is an independent freshman student, their annual full-time eligibility is $9,500, so their recalculated annual amount would be $4,750 ($2,375 per semester) to reflect their half-time enrollment for the fall and the spring.

Dependent freshman student enrolled full-time (12 credit hours) but drops 3 credits

• Full-time for a UWM undergraduate student is 12 credits per fall/spring term (24 credits per academic year).
• If enrolled full-time in both fall and spring semesters, they could receive $5,500/year ($2,750/semester).
• Drops to 9 hours in fall after aid has been disbursed. No changes to the fall loan disbursement are required at that point in time.
• Enrolls for 12 hours in the spring semester.
  • 9 hours in the fall + 12 hours in the spring = 21 annual credit hours
    • 21/24 credits is 88%
    • 88% of $5,500 = $4,840 would be the annual limit
    • Since $2,750 was received in the fall, subtract $2,750 from the new annual limit of $4,840, and the spring loan amount would be $2,090.

Independent freshman student enrolled full-time (12 credit hours) but drops 3 credits

• Full-time for a UWM undergraduate student is 12 credits per fall/spring term (24 credits per academic year).
• If enrolled full-time both in fall and spring semesters, they could receive $9,500/year ($4,750/semester).
• Drops to 9 hours in fall after aid has been disbursed. No changes to the fall loan disbursement are required at that point in time.
• Enrolls for 12 hours in the spring semester.
  • 9 hours in the fall + 12 hours in the spring = 21 annual credit hours
    • 21/24 credits is 88%
    • 88% of $9,500 = $8,360 would be the annual limit
    • Since $4,750 was received in the fall, subtract $4,750 from the new annual limit of $8,360, and the spring loan amount would be $3,610.

• Effective with the 2026-27 academic year, students who have scholarships covering their full cost of attendance will be ineligible for Pell Grant if their total aid from other sources equals or exceeds their cost of attendance. Scholarships may need to be reduced in order to retain your Pell Grant eligibility.
• An applicant with a Student Aid Index (SAI) equal to or greater than twice the maximum Federal Pell Grant award amount for the award year is ineligible for a Federal Pell Grant. This limit does not apply to students who qualify for a Federal Pell Grant under the Special Rule (dependents of certain deceased service members and public safety officers).
• If you excluded foreign earned income from your tax return in accordance with U.S. tax law, that amount will be added back to the adjusted gross income (AGI) on the FAFSA form. It will be considered when when determining Federal Pell Grant eligibility.

• The Graduate PLUS Loan for graduate and professional students is being eliminated effective July 1, 2026 for new borrowers.
• Legacy Provision: If a student is enrolled in the same program of study in 2026-27 as in 2025-26; and the student borrowed and received funds in the Direct Loan Program (Unsubsidized or Graduate PLUS) that was disbursed prior to July 1, 2026, they can continue to borrow Grad PLUS for up to the shorter of either three academic years or the remaining length of the student’s program based on what they have already completed. The student must maintain continuous enrollment in their program.
  

• Effective with the 2026-27 academic year, full-time graduate students who are new borrowers may borrow up to $20,500 annually, with an aggregate limit of $100,000, excluding undergraduate borrowing.
• Legacy Provision: Full-time graduate students who are under legacy provision will continue to be able to borrow up to $20,500 annually, with an aggregate limit of $138,500, including undergraduate borrowing. Students who lose legacy eligibility will have the same aggregate limits as new borrowers listed above. Students cannot choose which limit applies to them, as it is defined by the Department of Education (ED).
• Professional Students (as currently defined by ED): New professional students, effective July 1, 2026, may borrow up to the cost of attendance or $50,000 per year (whichever is less) in unsubsidized loans, with an aggregate limit of $200,000, excluding undergraduate borrowing. UWM has the following programs that qualify at this time:
  • Educational Psychology (PhD)
  • School Psychology (PhD)
• Starting July 1, 2026, the One Big Beautiful Bill Act (OB3) establishes a cumulative $257,500 lifetime limit on federal student loans. This cap includes all undergraduate, graduate, and professional borrowing, including Grad PLUS loans. Once a borrower reaches this limit, they are no longer eligible for additional Title IV loans, even if prior loans are repaid. For students who have lost legacy eligibility, the lifetime cap applies and includes all prior borrowing.

Effective with the 2026-27 academic year, undergraduate and graduate student loan borrowers enrolled less than full-time will have loan amount recalculated to reflect enrolled hours. Any classes that are dropped after disbursement in one semester will impact a subsequent loan amount in the same academic year. UWM’s next academic year includes Fall 2026, Spring 2027, and Summer 2027.

Recalculation Formula

Number of credit hours enrolled for the academic year divided by Number of credit hours considered full-time times the Annual Loan Limit.

Recalculation Examples

Student Enrolled Part-Time

• Full-time for a UWM graduate student is 8 credits per fall/spring term (16 credits per academic year).
• A graduate student enrolled in 4 credits in the fall and 4 credits in the spring is 50% enrolled each term.
• Their loan will be recalculated to 50% of their annual eligibility.
• If the student is eligible for $20,500 ($10,250 per semester) at full-time for the two semesters combined, then their recalculated amount will be reduced to $10,250 ($5,125 per semester) to reflect their half-time enrollment.

Graduate student enrolled full-time (8 credit hours) and drops to 3 credit hours

• Full-time for a UWM graduate student is 8 credits per fall/spring term (16 credits per academic year).
• If full-time both fall and spring semesters, they could receive $20,500/year ($10,250/semester).
• Drops to 3 hours in fall after initial disbursement. No changes to the fall loan disbursement are required at that point in time.
• Enrolls for 8 hours in the spring semester.
  • 3 hours in the fall + 8 hours in the spring = 11 annual credit hours
    • 11/16 credits is 69%
    • 69% of $20,500 = $14,145 would be the annual limit
    • Since $10,250 was received in the fall, subtract $10,250 from the new annual limit of $14,145, and the spring loan amount would be $3,895.

• The Repayment Assistance Plan (RAP) will become the only income-based plan.
• RAP monthly payments are calculated based on Adjusted Gross Income (AGI).
• A $10 minimum monthly payment is required, and a borrower’s RAP monthly payment is based on their AGI and number of dependents.
• Income and dependents are calculated separately for married borrowers who file taxes separately from their spouses.
• Borrowers who don’t have an AGI or whose AGI doesn’t reasonably reflect the borrower’s current income are required to provide the U.S. Department of Education (ED) with documentation to calculate their monthly payments.
• 30-year repayment period

The standard repayment plan has fixed monthly payments and fixed terms ranging from 10 to 25 years based on the amount borrowed. If you want a repayment plan based on your income, the only option available is RAP (the Repayment Assistance Plan).

• Borrowers who received loans exclusively before July 1, 2026, are eligible to enroll in the new or some of the existing payment plans: Standard, Income-Based (IBR), Graduated and Extended repayment plans, or RAP (the Repayment Assistance Plan). If any loans are borrowed after July 1, 2026, only the new RAP and Standard options are available.
• Those currently enrolled in the Income-Contingent Repayment (ICR), Pay As You Earn (PAYE), or Saving on a Valuable Education (SAVE) plans must transition to a new repayment plan by July 1, 2028. If no selection is made by that date, borrowers will be automatically moved to RAP.