Financial Aid Updates: 2026-2027

FAFSA Updates

OBBBA changes how certain assets are reported on the FAFSA:

• Qualified family farms and family-owned small businesses are no longer counted as assets
• Family-owned commercial fisheries are now also excluded

Federal Pell Grant Eligibility

OBBBA updated several rules that are used to determine Pell Grant eligibility.

• Students with a Student Aid Index (SAI) greater than twice the maximum Pell Grant amount may not qualify for a Pell Grant.
  • For the 2026–2027 award year, this applies to students with an SAI above $14,790.
• The foreign-earned income exclusion must be included in income calculations when determining Pell Grant eligibility.
• Students whose Cost of Attendance (COA) is fully covered by non-federal aid (scholarships, third-party payments, etc.) will not be eligible to receive the Pell Grant.

New Federal Direct Loan Limits

OBBBA introduces new limits on how much students and parents can borrow.

• Updated aggregate loan limits for graduate and professional students
• New lifetime borrowing limit on all federal student loans of $257,500, excluding Parent Loans for Undergraduate Students (PLUS)
• Annual loan limit of $20,000 and an aggregate limit of $65,000 per dependent student for parent PLUS loans
• Legacy protections possible for borrowers with loans made before July 1, 2026

Most Tri-C undergraduate students may not see major changes now, but these loan limits could impact transfer or graduate school borrowing later.

Loan Eligibility for Less-Than-Full-Time Enrollment

Starting July 1, 2026, OBBBA applies new Federal Direct Loan provisions for students enrolled less than full time.

• Loan amounts may be prorated based on enrollment level.
• Loan eligibility may be reduced for students enrolled less than full time.
• Students must still be enrolled at least half time (6 credit hours) to qualify.
• Example: A student enrolled in 6 credit hours may receive about half the loan amount of a student enrolled in 12 credit hours.

Students planning to enroll less-than-full-time are encouraged to meet with their Financial Aid Advisor to create a financial aid plan and understand how their loan eligibility may be affected.

Changes to Student Loan Repayment

New Federal Direct Loan borrowers after July 1, 2026, will have two primary repayment options:

• Standard Repayment Plan (fixed payments)
• Repayment Assistance Plan (RAP) (income-based)

Additional changes include:

• Phase-out of many current income-driven repayment plans by July 1, 2028
• Elimination of economic hardship and unemployment deferments (with some grandfathering)
• New forbearance limits: Up to nine months within a two-year period (previously 12 months over three years)
• Borrowers may rehabilitate a defaulted federal student loan twice (previously one time)

How is the SFAS Office preparing?

The SFAS Office is actively reviewing federal regulations and updating institutional policies and systems to ensure compliance with OBBBA. Tri-C students may see updates to:

• Financial aid processing
• Loan awarding procedures
• Counseling tools and resources

Students should monitor communications from the Financial Aid office for ongoing updates.

When do these changes take effect?

Some updates, like those to the FAFSA, are already in place. Most other changes will begin July 1, 2026, which aligns with the 2026–2027 financial aid award year.

Will this change my 2025–2026 financial aid award?

No. Your current 2025–2026 financial aid package will not be impacted by this new law.

Will my Pell Grant eligibility change?

It depends. Pell Grant eligibility can vary from year to year based on the information you provide on your FAFSA. To make sure you receive all the aid you qualify for:

• Submit your FAFSA every year
• Check your Financial Aid Dashboard regularly
• Review your Financial Aid Offer when it becomes available

Can I still receive a Federal Pell Grant if I have a Tri-C scholarship?

Possibly. The average Tri-C scholarship is about $1,500, and this amount should not be affected by the new Cost of Attendance (COA) rules. However, if your Tri-C scholarship and other non‑federal aid fully cover your COA, your Pell Grant eligibility may be limited.

Can I still borrow loans if I attend less than full time?

Yes. Eligible students may still receive Federal Direct Loans, but the amount will be prorated based on enrolled credit hours.

Example:

• A full-time student (12 credit hours) may receive $2,000 for one term.
• A half-time student (6 credit hours) would receive $1,000 for that term.

My loan eligibility was reduced. What other options can help me pay for college?

Students who need additional support can:

• Apply for Tri-C scholarships
• Connect with Student Basic Needs/Project GO!
• Explore Federal Work-Study opportunities

Who can I contact for help?

The SFAS Office is here to support you. Financial Aid Advisors can answer questions, explain your options, and help you plan for upcoming changes.

• Connect with your Financial Aid Advisor
• Email: financialaid@tri-c.edu
• Phone: 216-987-6000, option 2