Financial Aid Updates

Important Changes to Federal Financial Aid Beginning July 1, 2026

The One Big Beautiful Bill Act (OBBBA) was signed into law on July 4, 2025. It makes several changes to Federal Pell Grants and Federal Direct Student Loans. These changes take effect July 1, 2026.

Please note: The U.S. Department of Education is still providing guidance, so this information may be updated as new details become available.

Federal Pell Grant Changes

  • If your grants and scholarships from non-federal sources (such as state, institutional or private scholarships) cover your entire cost of attendance, you cannot receive a Federal Pell Grant, even if you would normally qualify.
  • If your Student Aid Index (SAI) is 14790 or higher (currently twice the maximum Pell Grant award), you will not qualify for a Federal Pell Grant.

Federal Student Loan Changes for Part-Time Students

Beginning July 1, 2026:

  • If you are not enrolled full-time, your Federal Direct Student Loan amount may be reduced based on the number of credit hours you are taking.
    • Full-time undergraduate students: 12 or more credit hours
  • You must be enrolled at least half-time to receive federal student loans.
    • Undergraduate students: At least 6 credit hours
  • If you drop below 6 credit hours, you will lose eligibility for your federal student loans for that semester

Important: Dropping or withdrawing from classes will affect not only your current semester's loan but also future loan disbursements.

Lifetime Federal Student Loan Limit

  • The new lifetime limit for Federal Direct Student Loans will be $257,500 (for undergraduate and graduate).
  • This limit does not include Parent PLUS Loans borrowed by a parent on a dependent student's behalf.

Legacy Provision

If you received a Federal Direct Student Loan before July 1, 2026, while enrolled in your current degree or certificate program, you may be able to continue borrowing under the current loan limits for up to three academic years or until you finish your program, whichever comes first.

However, you could lose this protection if you:

  • Withdraw from school,
  • Stop attending for a period of time,
  • Change your degree or certificate program or
  • Transfer to another college.

If you transfer schools, check with your Financial Aid Office to see if your legacy status still applies.

Parent PLUS Loan Changes

Beginning July 1, 2026:

  • Parents may borrow up to $20,000 per student each year.
  • The lifetime borrowing limit will be $65,000 per student.

Parent PLUS Legacy Provision

If a parent received a Parent PLUS Loan before July 1, 2026, while their student was enrolled in a degree or certificate program, they may continue borrowing under the current limits for up to three academic years or until the student finishes the program, whichever comes first.

A parent may lose this protection if the student:

  • Withdraws from school,
  • Stops attending for a period of time,
  • Changes programs or
  • Transfers to another college.

If a student transfers, the parent should check with the Financial Aid Office to determine whether their legacy status will continue.

For questions contact ICC Financial Aid at 662.862.8220, 662.620.5319 or finaid@iccms.edu.