New Graduate Student Loan Restrictions May Encourage Schools to Lower Tuition

Stricter loan limits for graduate students will likely encourage schools to lower tuition costs, but additional efforts will be required to ensure that all potential students can afford a master’s or doctoral degree, a recent report from the Consumer Bankers Association suggests.
Starting in the 2026-27 academic year, the PLUS loan program will be eliminated for all new graduate students. Previously, students in a graduate program could borrow enough through the Grad PLUS program to cover the total cost of their degree.
The previous limit on Grad PLUS loans contributed to rising graduate tuition costs, the Department of Education says. In the 2011-2012 academic year, in-state tuition and fees for the average graduate program were $19,637, according to the National Center for Education Statistics. A decade later, those costs had risen $876 when adjusted for inflation, the most recent data showed.
Graduate students will still be able to borrow federal unsubsidized student loans, with a maximum of $200,000 across their entire graduate education. This new cap, however, is lower than what students were able to borrow through the Grad PLUS loan program