OBBBA Updates to Financial Aid
The One Big Beautiful Bill Act (OBBBA) was signed into law on July 4, 2025 and requires several changes to federal student aid programs. While some changes went into effect immediately, several of these changes will begin on July 1, 2026.
See below for a list of changes that will impact our students and families.
*Please note that the below information has not been finalized. We are actively monitoring this legislation and will make updates to this page as they become available.
Updates to Federal Direct Loans:
The OBBBA requires significant updates to Federal Direct Loan programs. See below for details on the updates.
Beginning July 1, 2026, Federal Direct Subsidized and Unsubsidized loans will be prorated based on the number of credits in which a student is enrolled/academically engaged.
Similar to the Pell grant, students are offered the maximum amount of Federal Direct Loan funding per year based on full-time enrollment. See below for an enrollment guide detailing the number of credits in which a student must be enrolled/academically engaged to be considered full-time for financial aid purposes.
| Fall/Spring | Summer | |
| Undergraduate Students | 12 Credits | 12 Credits |
| Graduate Students | 9 credits | 5 credits |
With the new Federal Direct Loan proration requirement, full-time students will receive the full amount of their annual loan offer. If a student is enrolled less than full-time, they will not be eligible to receive the full-time amount of loans offered to them. Instead, the university will calculate the amount of loan funding the student is eligible to receive based on the number of credits in which they are enrolled/academically engaged.
See below for annual Federal Direct Loan limits.
If dependent, your subsidized and unsubsidized Direct Loan annual eligibility is as follows:
|
|
0-31 Earned Credits
|
32-63 Earned Credits
|
64 and Above Earned Credits
|
|---|---|---|---|
|
Subsidized
|
$3,500
|
$4,500
|
$5,500
|
|
Unsubsidized
|
$2,000
|
$2,000
|
$2,000
|
|
Total
|
$5,500
|
$6,500
|
$7,500
|
If independent, your subsidized and unsubsidized Direct Loan annual eligibility is as follows:
|
|
0-31 Earned Credits
|
32-63 Earned Credits
|
64 and Above Earned Credits
|
|---|---|---|---|
|
Subsidized
|
$3,500
|
$4,500
|
$5,500
|
|
Unsubsidized
|
$6,000
|
$6,000
|
$7,000
|
|
Total
|
$9,500
|
$10,500
|
$12,500
|
Students may borrow up to $20,500 each academic year of a Federal Direct Unsubsidized Loan.
The formula we will use to determine how much of a federal direct loan a student may receive in a semester based on the number of credits in which they are enrolled is below.
Credit Hours Enrolled
_____________________________________________
Credit Hours required to be full time in a term
x Annual Direct Subsidized/Unsubsidized Loan Limit
At minimum, students need to be enrolled at least half-time to receive any Federal Direct Loan funding.
See below for an enrollment guide detailing the number of credits in which a student must be enrolled/academically engaged to be considered half-time for financial aid purposes.
| Fall/Spring | Summer | |
| Undergraduate Students | 6 Credits | 6 Credits |
| Graduate Students | 5 credits | 3 credits |
The One Big Beautiful Bill Act (OBBBA) completely eliminates the Graduate PLUS Loan program for new borrowers beginning July 1, 2026.
If you borrowed any type of Federal Direct Loan for the degree program in which you are currently enrolled before July 1, 2026:
Anyone who has previously borrowed a Federal Direct Loan of any kind during their current degree program and prior to July 1, 2026 may borrow a Graduate PLUS loan for up to three additional academic years or until they complete their program, whichever comes first. Only students who borrowed a Federal Direct Loan for the degree program in which they are currently enrolled may borrow a new Graduate PLUS Loan.
If you're eligible to borrow a Graduate PLUS Loan:
Graduate students are eligible to borrow under the PLUS Loan program up to their cost of attendance minus other financial assistance. Students can apply by logging into and completing the application. Applicants for these loans are required to complete the . Learn more and apply at .
Eligibility is based on credit. An endorser may be required for some loans to be approved.
Learn more and apply at .
If you did not borrow any type of Federal Direct Loan for the degree program in which you are currently enrolled before July 1, 2026:
Anyone who did not borrow a Federal Direct Loan of any kind for the degree program in which they are currently enrolled before July 1, 2026 is not eligible to borrow a Graduate PLUS loan after July 1, 2026.
Other options to help cover costs for students who are unable to borrow a Graduate PLUS Loan include:
- Borrowing Federal Direct Unsubsidized Loans
- Borrowing private loans
- Applying for scholarships
- Utilizing payment plans
Explore additional sources of financial aid for graduate students at stockton.edu/finaid.
Parent PLUS Loan borrowing will change as a result of the OBBBA. These changes include updates to annual and lifetime borrowing limits for Parent PLUS Loan borrowers.
- For parents who borrowed a Parent PLUS Loan prior to July 1, 2026:
Parents who borrowed a Parent PLUS Loan prior to July 1, 2026 whose student is still enrolled in the same degree program they were when their parent borrowed the Parent PLUS Loan may continue to borrow up to their student's Cost of Attendance (COA) and will not be subject to a lifetime limit for that child for three additional academic years or until the child completes their degree program, whichever comes first.
- For parents who did not borrow a Parent PLUS Loan prior to July 1, 2026:
Parents who did not borrow a Parent PLUS Loan prior to July 1, 2026 will be able to borrow up to $16,250 per academic year, per child and up to $65,000 per child in their lifetime.
*Please note that the Federal Parent PLUS Loan limit is changing to up to $20,000 per academic year, per child; however, to ensure that parents have remaining eligibility if approved for Parent PLUS Loan funding in additional years, parents will be able to borrow up to $16,250 per child, per year at Â鶹´«Ă˝ÍřŐľ. If approved, this will allow them to borrow the new lifetime limit of $65,000 in four years. Otherwise, eligibility could run out before a student graduates.
Graduate and professional student lifetime federal direct loan limits have changed under the OBBBA. The new loan limits, which are effective July 1, 2026 are below:
| Annual | Lifetime | |
| Graduate Students | $20,500 | $100,000 |
| Professional Students | $50,000 | $250,000 |
*Please note that these new loan limits do not include undergraduate borrowing. The are solely based on graduate/professional borrowing. Students may borrow up to $100,000 for their graduate study and $250,000 for their professional study.
Previous annual and lifetime limits will continue to apply to anyone who previously borrowed a Federal Direct Loan prior to July 1, 2026 and is currently enrolled in the same degree program they were when they borrowed a Federal Direct Loan for up to three academic years or until they complete their degree program, whichever comes first. Previously, graduate and professional students shared the same annual limit of $20,500 and lifetime limit of $138,500.
A $257,500 lifetime borrowing limit will apply to all federal student loans, with the exception of Parent PLUS and Graduate PLUS Loans.
Updates to Repayment Plans:
The OBBBA makes several significant changes to loan repayment. See below for details on the updates.
Current borrowers with no new loans made on or after July 1, 2026 may enroll in any of the below repayment plans:
- The Current Standard Repayment Plan
- The Graduated Repayment Plan
- The Extended Repayment Plan
- The Current Income Based (IBR) repayment plans
- The New Repayment Assistance Plan (RAP)
- Details below
Current borrowers may also switch between, enter or remain on existing IDR plans until July 1, 2028. If no selection is made by that date, they will be automatically moved into RAP.
Under the Repayment Assistance Plan, your required monthly payment amount is based on your income and the number of your dependents, instead of being based on your loan debt, interest rate, and repayment period (as it would be under the ). Changes in your income or number of dependents will result in changes to your monthly payment amount. If you choose the Repayment Assistance Plan, you must
- authorize us to obtain tax information from the Internal Revenue Service (IRS) showing your income and number of dependents or
- provide other documentation of your income (and your spouse’s income, if applicable) and number of dependents.
We use this information to calculate your monthly payment amount under the Repayment
Assistance Plan and to recalculate your monthly payment amount each year based on
your income and number of dependents at that time.
Borrower and Loan Eligibility
If you have a single loan—including a Direct Consolidation Loan—that is first disbursed
on or after July 1, 2026, then you’ll have access to only the Repayment Assistance
Plan and/or the Tiered Standard Plan as repayment options for all of your Direct Loans,
including any type of Direct Loan first disbursed before July 1, 2026.
Most Direct Loan borrowers will have access to the Repayment Assistance Plan for your
Direct Loans, with the exception of the following loan types that are ineligible for repayment under the Repayment Assistance Plan:
- Direct PLUS Loans for parents
- Direct Consolidation Loans that paid off a Direct PLUS Loan for parents
- Direct Consolidation Loans that paid off a Direct Consolidation Loan that paid off a Direct PLUS loan for parents (sometimes referred to as a double consolidation)
Typically, all of a borrower’s Direct Loans must be paid under the same plan. However, if you have one of the ineligible loan types listed above and any of the following Direct Loan types listed below, then the loans listed above will be permitted to be repaid separately under the Tiered Standard Plan. The following loan types may be repaid under either the Tiered Standard Plan or the Repayment Assistance Plan:
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Direct PLUS Loans for graduate or professional students
- Direct Consolidation Loans that don’t include a Direct PLUS loan for parents
Other loan programs, like the Federal Family Education Loan (FFEL) Program, the Federal
Perkins Loan Program, and the Health Education Loan (HEAL) Program, are not permitted
to be repaid under the Repayment Assistance Plan or the Tiered Standard Plan. If you
have a mix of loans in a program that’s ineligible for the new plans and you have
Direct Loans that are eligible for the new plans, then you may repay your Direct Loan(s)
under either of the two new plans according to loan type eligibility and the non-Direct
Loan(s) separately under one of the existing plans for which it is eligible.
Monthly Payment Amount
Your required monthly payment amount under the Repayment Assistance Plan is a percentage
of your annual income, most commonly your adjusted gross income (AGI), divided by
12 to determine the monthly payment amount. Your monthly payment amount is then reduced
by $50 for each dependent you claim on your federal tax return; however, your monthly
payment may not be less than $10 a month. The percentage of your annual income varies
depending on your AGI (see the “Repayment Assistant Plan base payment percentage”
table).
If you’re married and file a joint federal income tax return, your monthly payment
is generally based on the combined income of you and your spouse. However, your monthly
payment will be reduced if your spouse also has federal student loans.
If you’re married and file a separate tax return from your spouse, only your income
and the dependents you claim on your tax return will be used to determine your monthly
payment amount.
Repayment Assistance Plan base payment percentage
| Total Adjusted Gross Income (AGI) | Base Payment* |
| Not more than $10,000 | $120 |
| More than $10,000 and not more than $20,000 | 1% of your AGI |
| More than $20,000 and not more than $30,000 | 2% of your AGI |
| More than $30,000 and not more than $40,000 | 3% of your AGI |
| More than $40,000 and not more than $50,000 | 4% of your AGI |
| More than $50,000 and not more than $60,000 | 5% of your AGI |
| More than $60,000 and not more than $70,000 | 6% of your AGI |
| More than $70,000 and not more than $80,000 | 7% of your AGI |
| More than $80,000 and not more than $90,000 | 8% of your AGI |
| More than $90,000 and not more than $100,000 | 9% of your AGI |
| More than $100,000 | 10% of your AGI |
*The base payment is a percentage of your AGI that is used to determine what would
be paid over 12 months without accounting for any reductions for your dependents.
It is not the actual monthly payment amount that you’re required to pay each month.
The "Monthly Payment Amount Based on Your AGI Range” table includes the range of monthly
payment amounts derived from the base payment percentages.
Monthly Payment Amount Based on Your AGI Range*
| Range | Monthly Payment Amount Range |
| $0–$10,000 | $10 |
| $10,001–$20,000 | $10.00–$16.67 |
| $20,001–$30,000 | $33.34–$50.00 |
| $30,001–$40,000 | $75.00–$100.00 |
| $40,001–$50,000 | $133.34–$166.67 |
| $50,001–$60,000 | $208.34–$250.00 |
| $60,001–$70,000 | $300.01–$350.00 |
| $70,001–$80,000 | $408.34–$466.67 |
| $80,001–$90,000 | $533.34–$600.00 |
| $90,001–$100,000 | $675.01–$750.00 |
| More than $100,000 | At least $833.33 |
*This chart assumes you have no dependents. You can subtract $50 from the monthly
payment amount for each dependent you claim on your federal income tax return, but
your monthly payment amount can never be less than $10.
Payment Processing
Unless you’re required to pay late charges or other costs, when you make a payment
on your loan, we apply the payment first to any amount of outstanding interest as
of the date the payment was received. If the payment amount is more than the amount
of outstanding interest, we apply the remainder of your payment to your principal.
If you’re required to pay late charges or other costs, we apply your payment differently
depending on your repayment plan. If you’re repaying under the Repayment Assistance
Plan, we apply your payment first to outstanding interest, then to late charges and
other costs, and then to your principal.
If you’re repaying under the Tiered Standard Plan, we apply your payment first to late charges and other costs, then to outstanding interest, and then to your principal.
Interest Subsidy
Borrowers whose full, on-time monthly payments are less than the interest accrued
between the previous due date and the current payment date will have their unpaid
interest for that month subsidized.
Only the interest that accumulates from due date to due date after entering the Repayment Assistance Plan will be subsidized. Interest that accrues during any periods of nonrepayment or that accrued before entering the Repayment Assistance Plan won’t be subsidized.
Assuming all payments are made on time and in full and that you don’t take any breaks (like a deferment or forbearance) after entering the Repayment Assistance Plan, then your total outstanding balance will never go higher than your total outstanding balance when you entered the Repayment Assistance Plan.
Under the Repayment Assistance Plan, the interest subsidy is applicable to both subsidized and unsubsidized loans. Unlike the Income-Based Repayment (IBR) and Pay As You Earn (PAYE) Plans, this subsidy is not limited to the first three years in which your monthly payment amount doesn’t pay off all of the accrued interest.
Starting in March 2027, payments for the IBR Plan must be made on time and in full in order for you to receive the interest subsidy.
Additional Considerations
- The interest subsidy is applicable only for loans enrolled in the Repayment Assistance Plan and can be applied only to months for which (1) a borrower receives a bill with a monthly payment amount that’s derived using the Repayment Assistance Plan formula when (2) the borrower (or someone on the borrower’s behalf) makes a full and on-time payment to satisfy that same bill.
- If a borrower’s monthly payment amount isn’t enough to cover the interest that accrued since the previous due date and the borrower (or someone on the borrower’s behalf) chooses to pay more than the monthly payment amount, then any amount paid above the monthly payment amount will be applied first to accrued interest and then to the principal. This means that the additional amount paid may reduce or eliminate any interest subsidy that the borrower would’ve been entitled to if they hadn’t paid more than the amount due.
- In the near future, we’ll provide more information about how the interest subsidy will work when a borrower pays more than their amount due.
Matching Principal Payment
When a borrower makes a full, on-time payment and the principal isn’t reduced by at
least $50, then the secretary of education makes a matching principal payment to ensure
that the borrower’s principal is always reduced by at least the total amount paid
(but not to exceed $50).
A month’s eligibility to receive the matching principal payment is based on whether
or not that month’s payment is made on time and in full. However, the determination
for the amount of the matching principal payment to be applied to the loan is based on the actual
amount paid by the borrower (or on the borrower’s behalf) for that month.
In order to determine the amount of the matching principal payment that will be applied,
we use the following steps:
- Determine that the monthly payment was made on time (no later than its due date)
- Determine that the amount of money that was actually paid in that month is not less than the total amount due for the month
- Determine whether (after applying the payment) there was an outstanding principal reduction of less than $50
- Determine which is less: $50 or the total amount paid* in the month following the previous due date
- Subtract the total amount applied to the outstanding principal (in Step 3) in that month
*Amount does not include payments that were used to resolve delinquency.
Additional Considerations
- If a borrower makes a payment (or a payment is made on the borrower’s behalf) in a month in which the borrower hasn’t been billed due to being enrolled in the Repayment Assistance Plan and/or because the borrower’s loan isn’t in a repayment status, then that month won’t be eligible for a matching principal payment.
- If a borrower’s monthly payment amount would result in their principal being reduced by less than $50, but the borrower (or someone on the borrower’s behalf) pays more than the amount due for that month, then the expected matching principal payment might be reduced or eliminated for that month, since additional amounts paid can affect the calculation.
- In the near future, we’ll provide more information about how matching principal payments will work when a borrower pays more than their amount due.
Loan Discharge
Under the Repayment Assistance Plan, any remaining loan balance may be discharged
after you’ve satisfied 360 qualifying monthly payments over a period of at least 30
years.
Qualifying payments for the Repayment Assistance Plan include the following:
- Any progress toward discharge earned before entering the Repayment Assistance Plan, which could include payments made under income-driven repayment (IDR) plans
- Generally, payments made after enrolling in the Repayment Assistance Plan or the Tiered Standard Plan that are made on time, meaning that the payment is made on or before the date that the payment is due (commonly referred to as a monthly due date)
Additionally, the on-time payment must be made in full, meaning that the total amount
due (sometimes referred to as the monthly payment amount or the amount billed) is
made on or before its monthly due date.
Public Service Loan Forgiveness (PSLF)
Generally, payments made under the Repayment Assistance Plan are eligible for (PSLF) as long as the payment is made on time and in full.
In the near future, we’ll provide more information about the how the Repayment Assistance
Plan and the PSLF program will interact.
Federal and State Income Tax
Except for PSLF, you might have to pay federal and/or state income taxes on any loan
amount that is discharged. We’ll notify you when your loan is identified as eligible
for discharge, and you’ll be provided 21 days to opt out of the discharge.
For more information, please visit .
Borrowers with new loans made on or after July 1, 2026 can be repaid using one of two plans:
- The New Tiered Standard Repayment Plan
- Details below
- The New Repayment Assistance Plan (RAP)
- Details below
If a borrower with new loans made on or after July 1, 2026 does not select a plan, they will be assigned to the new standard repayment plan.
Under the Tiered Standard Plan, your required monthly payment amount is based on:
- the amount of your principal balance that you owe at the time that you enter the plan,
- the interest rate on your loans, and
- the length of the repayment period.
Borrower and Loan Eligibility
If you have a single loan—including a Direct Consolidation Loan—that is first disbursed
on or after July 1, 2026, then you’ll have access to only the Repayment Assistance
Plan and/or the Tiered Standard Plan as repayment options for all of your Direct Loans,
including any type of Direct Loan first disbursed before July 1, 2026.
All Direct Loan borrowers will have access to the Tiered Standard Plan for your Direct
Loans. Additionally, the following loan types are eligible for repayment only under the Tiered Standard Plan:
- Direct PLUS Loans for parents
- Direct Consolidation Loans that paid off a Direct PLUS Loan for parents
- Direct Consolidation Loans that paid off a Direct Consolidation Loan that paid off a PLUS loan for parents (sometimes referred to as a double consolidation)
Typically, all of your Direct Loans must be paid under the same plan. However, if you have one of the loan types listed above and any of the following Direct Loan types listed below, then the loans listed below may be repaid either together with those above (under the Tiered Standard Plan) or separately (under the Repayment Assistance Plan):
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Direct PLUS Loans for graduate or professional students
- Direct Consolidation Loans that don’t include a PLUS loan for parents
You might automatically be placed in the Tiered Standard Plan—even though you didn’t choose it—because:
- you’re entering or returning to repayment and haven’t chosen another eligible plan or
- you’re required to leave an existing plan and your loan type can be repaid only under the Tiered Standard Plan.
Other loan programs—like the Federal Family Education Loan (FFEL) Program, the Perkins
Loan Program, and the Health Education Loan (HEAL) Program—are not permitted to be
repaid in the Repayment Assistance Plan or the Tiered Standard Plan. If you have a
mix of loans in a program that’s ineligible for the new plans and you have Direct Loans that are eligible for the new plans, then you may repay your
Direct Loan(s) under either of the two new plans according to loan type eligibility
and the non-Direct Loan(s) separately under one of the existing plans for which it
is eligible.
Monthly Payment Amount
Under the Tiered Standard Plan, you’ll make fixed monthly payments and repay your
loan in full within the maximum repayment period outlined in the chart below (not
including periods of deferment or forbearance) from the date the loan entered the
Tiered Standard Plan. If you add additional loans to the plan at a later date (or
leave the plan and return to it), your maximum repayment period will be recalculated
based on the total outstanding principal balance on your Direct Loans upon reentering
the Tiered Standard Plan. Your payments must be at least $50 a month and can be more,
if necessary, to repay the loan within the required time period.
Maximum Repayment Period
| Total Direct Loan Outstanding Principal Balance | Maximum Repayment Period |
| Less than $25,000 | 10 years |
| Equal to or greater than $25,000 but less than $50,000 | 15 years |
| Equal to or greater than $50,000 but less than $100,000 | 20 years |
| Equal to or greater than $100,000 | 25 years |
Public Service Loan Forgiveness (PSLF)
Payments made while enrolled in the Tiered Standard Plan are not considered qualifying
payments for PSLF or Temporary Expanded Public Service Loan Forgiveness (TEPSLF).
For more information, please visit .
Under the Repayment Assistance Plan, your required monthly payment amount is based on your income and the number of your dependents, instead of being based on your loan debt, interest rate, and repayment period (as it would be under the ). Changes in your income or number of dependents will result in changes to your monthly payment amount. If you choose the Repayment Assistance Plan, you must
- authorize us to obtain tax information from the Internal Revenue Service (IRS) showing your income and number of dependents or
- provide other documentation of your income (and your spouse’s income, if applicable) and number of dependents.
We use this information to calculate your monthly payment amount under the Repayment
Assistance Plan and to recalculate your monthly payment amount each year based on
your income and number of dependents at that time.
Borrower and Loan Eligibility
If you have a single loan—including a Direct Consolidation Loan—that is first disbursed
on or after July 1, 2026, then you’ll have access to only the Repayment Assistance
Plan and/or the Tiered Standard Plan as repayment options for all of your Direct Loans,
including any type of Direct Loan first disbursed before July 1, 2026.
Most Direct Loan borrowers will have access to the Repayment Assistance Plan for your
Direct Loans, with the exception of the following loan types that are ineligible for repayment under the Repayment Assistance Plan:
- Direct PLUS Loans for parents
- Direct Consolidation Loans that paid off a Direct PLUS Loan for parents
- Direct Consolidation Loans that paid off a Direct Consolidation Loan that paid off a Direct PLUS loan for parents (sometimes referred to as a double consolidation)
Typically, all of a borrower’s Direct Loans must be paid under the same plan. However, if you have one of the ineligible loan types listed above and any of the following Direct Loan types listed below, then the loans listed above will be permitted to be repaid separately under the Tiered Standard Plan. The following loan types may be repaid under either the Tiered Standard Plan or the Repayment Assistance Plan:
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Direct PLUS Loans for graduate or professional students
- Direct Consolidation Loans that don’t include a Direct PLUS loan for parents
Other loan programs, like the Federal Family Education Loan (FFEL) Program, the Federal
Perkins Loan Program, and the Health Education Loan (HEAL) Program, are not permitted
to be repaid under the Repayment Assistance Plan or the Tiered Standard Plan. If you
have a mix of loans in a program that’s ineligible for the new plans and you have
Direct Loans that are eligible for the new plans, then you may repay your Direct Loan(s)
under either of the two new plans according to loan type eligibility and the non-Direct
Loan(s) separately under one of the existing plans for which it is eligible.
Monthly Payment Amount
Your required monthly payment amount under the Repayment Assistance Plan is a percentage
of your annual income, most commonly your adjusted gross income (AGI), divided by
12 to determine the monthly payment amount. Your monthly payment amount is then reduced
by $50 for each dependent you claim on your federal tax return; however, your monthly
payment may not be less than $10 a month. The percentage of your annual income varies
depending on your AGI (see the “Repayment Assistant Plan base payment percentage”
table).
If you’re married and file a joint federal income tax return, your monthly payment
is generally based on the combined income of you and your spouse. However, your monthly
payment will be reduced if your spouse also has federal student loans.
If you’re married and file a separate tax return from your spouse, only your income
and the dependents you claim on your tax return will be used to determine your monthly
payment amount.
Repayment Assistance Plan base payment percentage
| Total Adjusted Gross Income (AGI) | Base Payment* |
| Not more than $10,000 | $120 |
| More than $10,000 and not more than $20,000 | 1% of your AGI |
| More than $20,000 and not more than $30,000 | 2% of your AGI |
| More than $30,000 and not more than $40,000 | 3% of your AGI |
| More than $40,000 and not more than $50,000 | 4% of your AGI |
| More than $50,000 and not more than $60,000 | 5% of your AGI |
| More than $60,000 and not more than $70,000 | 6% of your AGI |
| More than $70,000 and not more than $80,000 | 7% of your AGI |
| More than $80,000 and not more than $90,000 | 8% of your AGI |
| More than $90,000 and not more than $100,000 | 9% of your AGI |
| More than $100,000 | 10% of your AGI |
*The base payment is a percentage of your AGI that is used to determine what would
be paid over 12 months without accounting for any reductions for your dependents.
It is not the actual monthly payment amount that you’re required to pay each month.
The "Monthly Payment Amount Based on Your AGI Range” table includes the range of monthly
payment amounts derived from the base payment percentages.
Monthly Payment Amount Based on Your AGI Range*
| Range | Monthly Payment Amount Range |
| $0–$10,000 | $10 |
| $10,001–$20,000 | $10.00–$16.67 |
| $20,001–$30,000 | $33.34–$50.00 |
| $30,001–$40,000 | $75.00–$100.00 |
| $40,001–$50,000 | $133.34–$166.67 |
| $50,001–$60,000 | $208.34–$250.00 |
| $60,001–$70,000 | $300.01–$350.00 |
| $70,001–$80,000 | $408.34–$466.67 |
| $80,001–$90,000 | $533.34–$600.00 |
| $90,001–$100,000 | $675.01–$750.00 |
| More than $100,000 | At least $833.33 |
*This chart assumes you have no dependents. You can subtract $50 from the monthly payment amount for each dependent you claim on your federal income tax return, but your monthly payment amount can never be less than $10.
Payment Processing
Unless you’re required to pay late charges or other costs, when you make a payment
on your loan, we apply the payment first to any amount of outstanding interest as
of the date the payment was received. If the payment amount is more than the amount
of outstanding interest, we apply the remainder of your payment to your principal.
If you’re required to pay late charges or other costs, we apply your payment differently
depending on your repayment plan. If you’re repaying under the Repayment Assistance
Plan, we apply your payment first to outstanding interest, then to late charges and
other costs, and then to your principal.
If you’re repaying under the Tiered Standard Plan, we apply your payment first to late charges and other costs, then to outstanding interest, and then to your principal.
Interest Subsidy
Borrowers whose full, on-time monthly payments are less than the interest accrued
between the previous due date and the current payment date will have their unpaid
interest for that month subsidized.
Only the interest that accumulates from due date to due date after entering the Repayment Assistance Plan will be subsidized. Interest that accrues during any periods of nonrepayment or that accrued before entering the Repayment Assistance Plan won’t be subsidized.
Assuming all payments are made on time and in full and that you don’t take any breaks (like a deferment or forbearance) after entering the Repayment Assistance Plan, then your total outstanding balance will never go higher than your total outstanding balance when you entered the Repayment Assistance Plan.
Under the Repayment Assistance Plan, the interest subsidy is applicable to both subsidized and unsubsidized loans. Unlike the Income-Based Repayment (IBR) and Pay As You Earn (PAYE) Plans, this subsidy is not limited to the first three years in which your monthly payment amount doesn’t pay off all of the accrued interest.
Starting in March 2027, payments for the IBR Plan must be made on time and in full in order for you to receive the interest subsidy.
Additional Considerations
- The interest subsidy is applicable only for loans enrolled in the Repayment Assistance Plan and can be applied only to months for which (1) a borrower receives a bill with a monthly payment amount that’s derived using the Repayment Assistance Plan formula when (2) the borrower (or someone on the borrower’s behalf) makes a full and on-time payment to satisfy that same bill.
- If a borrower’s monthly payment amount isn’t enough to cover the interest that accrued since the previous due date and the borrower (or someone on the borrower’s behalf) chooses to pay more than the monthly payment amount, then any amount paid above the monthly payment amount will be applied first to accrued interest and then to the principal. This means that the additional amount paid may reduce or eliminate any interest subsidy that the borrower would’ve been entitled to if they hadn’t paid more than the amount due.
- In the near future, we’ll provide more information about how the interest subsidy will work when a borrower pays more than their amount due.
Matching Principal Payment
When a borrower makes a full, on-time payment and the principal isn’t reduced by at
least $50, then the secretary of education makes a matching principal payment to ensure
that the borrower’s principal is always reduced by at least the total amount paid
(but not to exceed $50).
A month’s eligibility to receive the matching principal payment is based on whether
or not that month’s payment is made on time and in full. However, the determination
for the amount of the matching principal payment to be applied to the loan is based on the actual
amount paid by the borrower (or on the borrower’s behalf) for that month.
In order to determine the amount of the matching principal payment that will be applied,
we use the following steps:
- Determine that the monthly payment was made on time (no later than its due date)
- Determine that the amount of money that was actually paid in that month is not less than the total amount due for the month
- Determine whether (after applying the payment) there was an outstanding principal reduction of less than $50
- Determine which is less: $50 or the total amount paid* in the month following the previous due date
- Subtract the total amount applied to the outstanding principal (in Step 3) in that month
*Amount does not include payments that were used to resolve delinquency.
Additional Considerations
- If a borrower makes a payment (or a payment is made on the borrower’s behalf) in a month in which the borrower hasn’t been billed due to being enrolled in the Repayment Assistance Plan and/or because the borrower’s loan isn’t in a repayment status, then that month won’t be eligible for a matching principal payment.
- If a borrower’s monthly payment amount would result in their principal being reduced by less than $50, but the borrower (or someone on the borrower’s behalf) pays more than the amount due for that month, then the expected matching principal payment might be reduced or eliminated for that month, since additional amounts paid can affect the calculation.
- In the near future, we’ll provide more information about how matching principal payments will work when a borrower pays more than their amount due.
Loan Discharge
Under the Repayment Assistance Plan, any remaining loan balance may be discharged
after you’ve satisfied 360 qualifying monthly payments over a period of at least 30
years.
Qualifying payments for the Repayment Assistance Plan include the following:
- Any progress toward discharge earned before entering the Repayment Assistance Plan, which could include payments made under income-driven repayment (IDR) plans
- Generally, payments made after enrolling in the Repayment Assistance Plan or the Tiered Standard Plan that are made on time, meaning that the payment is made on or before the date that the payment is due (commonly referred to as a monthly due date)
Additionally, the on-time payment must be made in full, meaning that the total amount
due (sometimes referred to as the monthly payment amount or the amount billed) is
made on or before its monthly due date.
Public Service Loan Forgiveness (PSLF)
Generally, payments made under the Repayment Assistance Plan are eligible for (PSLF) as long as the payment is made on time and in full.
In the near future, we’ll provide more information about the how the Repayment Assistance
Plan and the PSLF program will interact.
Federal and State Income Tax
Except for PSLF, you might have to pay federal and/or state income taxes on any loan
amount that is discharged. We’ll notify you when your loan is identified as eligible
for discharge, and you’ll be provided 21 days to opt out of the discharge.
For more information, please visit .
Consolidation loans made on or after July 1, 2026, are only eligible for the new Repayment Assistance Plan (RAP) or standard repayment plans.
A consolidation loan (subsidized or unsubsidized) taken out by a borrower before July 1, 2026, is treated like any other eligible loan.
Borrowers currently in an IDR plan have until July 1, 2028, to select a standard plan, IBR, or RAP.
If the consolidation loan was used to pay off a Parent PLUS Loan, the borrower must enroll in ICR and make at least one payment under ICR before July 1, 2028 in order to be eligible for IBR when ICR is sunset. If the borrower takes no action by that date, all eligible loans will be automatically moved to RAP, and any loans not eligible for RAP will be placed into IBR.
All new Parent PLUS loans from July 1, 2026 on must be repaid under the standard repayment plan, they are not eligible for RAP. If a borrower chooses RAP, but has a loan that is not eligible for RAP (like Parent PLUS and certain consolidated loans) they must repay the ineligible loan(s) separately.
For borrowers who had borrowed Parent PLUS before July 1, 2026, and subsequently borrowed from the program on or after July 1, 2026, repayment for all loans must be under the same repayment plan, of which the only eligible plan for Parent PLUS borrowers is the standard plan.
Under the One Big Beautiful Bill Act (OBBBA), Parent PLUS loans issued on or after July 1, 2026, will not have access to Income-Driven Repayment (IDR) plans, making them ineligible for Public Service Loan Forgiveness (PSLF). Existing borrowers must consolidate into a Direct Loan and enter the Income-Contingent Repayment (ICR) plan before July 1, 2028, to maintain PSLF eligibility.
The OBBBA will sunset economic hardship and unemployment deferments. These circumstances will not be considered for loan deferment after July 1, 2027.
Borrowers with loans made on or before July 1, 2027, are still able to use these deferment options under the current rules. Once all borrower’s loans made prior to that date are paid in full, these options will cease to exist.
Loans made on or after July 1, 2027 will be eligible for forbearance for up to nine months in any two-year period.
Current rules allow for a forbearance up to 12 months at a time, with a cumulative limit of three years.
Updates to Pell Grants:
In addition to the changes to the Federal Direct Loan programs, the OBBBA has also changed some Pell grant eligibility criteria. See below for details on the updates.
Any student whose entire Cost of Attendance (COA) is covered by other non-federal grants and scholarships will not be able to receive a Pell grant even if they meet other eligibility criteria for the program.
Students whose Student Aid Index (SAI) exceeds twice the maximum Pell grant award for an academic year will not be eligible to receive a Pell grant. The maximum Pell grant for the 2026-2027 academic year is $7,395; therefore, anyone whose SAI is 14,970 or higher will not be eligible to receive a Pell grant even if they meet other eligibility criteria for the program.
Additional Resources:
We're here for you, Ospreys! We understand that many of these changes will be significant for our students and families.
For additional information on the updates to Federal Student Aid programs as a result of the OBBBA, visit .
Information on aid opportunities for undergraduate and graduate students can be found at stockton.edu/finaid.
Have questions? We're here to help! Visit stockton.edu/contactfinaid to email or schedule a phone appointment with our staff!
