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Federal Loan changes

Notice

The information on this page will be updated as and when we receive further guidance from the US Department of Education (USDE). As the following information is subject to change, please keep checking back for updates.

Upcoming changes

On 4 July 2025, the One Big Beautiful Bill Act was signed into law by the USDE, introducing significant changes to the federal student aid programme. These changes will take effect from 1 July 2026.

If you are a continuing student who received Federal Loans in 2025/26, you will be classed as a legacy student for US Federal Loans purposes.

What “legacy student” means

A legacy student is someone who:

  • began their programme before 1 July 2026 and
  • received federal loan funds during the 2025/26 academic year.

Legacy students may continue to receive Federal Loans under the current regulations, provided they:

  • remain continuously enrolled and
  • are on track to complete within their expected time to credential (the original standard timeframe for their award).

You may continue to apply for loans under the current regulations for up to 3 years, or until your original programme end date, whichever comes first.

When legacy status is lost

It is important to understand that legacy status is not permanent. You will lose legacy status and become a nonlegacy student if any of the following applies to you:

  • take a break in study (interruption, suspension, or leave of absence)
  • change course, including transferring to a different programme or award
  • do not complete your programme within the expected time to credential (the original standard timeframe for your award)
  • withdraw or take time-out and later return to study.

If you lose legacy status, you will be assessed under the new USDE regulations, which may affect your eligibility for Federal Loans. Find more information about loan limits for legacy and non-legacy students on our website.

Information for students in a sandwich or DPS year

We are still awaiting clarification from USDE regarding eligibility for students who take part (or have taken part) in a sandwich / Diploma in Professional Studies (DPS) year.

Dropping below full-time status

To remain eligible for Federal Loans, all students must be enrolled at least halftime.

From 1 July 2026, if you drop below fulltime, your loan limits will be prorated based on your courseload.

For example:

If you study at 50% of a fulltime courseload, your loan limits will be 50% of the usual amount.

Note: Prorating does not apply to Parent PLUS loans.

UAL is waiting for further guidance

We are still waiting for additional clarification from the USDE on how the new regulations will be implemented for the academic 2026/27 year.

Reminder: You must reapply for loans each year. Federal Loans do not automatically continue. If you plan to apply for loans for 2026/27, you can:

Please see our ‘how to Apply’ webpage for more information.

Questions?

If you have any concerns about your enrolment, progression or plans that might affect your legacy status, please contact the US Loans Team at USCanadaLoans@arts.ac.uk