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One Big Beautiful Bill Act explained: What future law students need to know about financial aid

Graduate and professional student financing is changing for students beginning studies in fall 2026 or later. Here is what future law students need to know to plan for financing their legal education.

If you have seen headlines about the One Big Beautiful Bill Act (OBBBA, also referred to as the Working Families Tax Cuts Act), you may be wondering whether law school is still financially within reach. We strongly encourage you not to panic. There are a lot of options to explore. It will be helpful to understand which rules apply to you and your overall financial picture. We also recommend planning earlier than you might have in the past.

Federal financing changes that took effect July 1, 2026, include:

How much graduate and professional students can borrow through federal programs
Which types of federal loans are available
How enrollment intensity impacts borrowing limits
How borrowers repay their federal loans

The financial aid changes apply to students who will begin their degree program in fall 2026 or after. The changes require more intentional planning for your educational investment. Federal loan availability is only one consideration. Scholarships, personal resources, program structure, military benefits, employer support and expected outcomes are some of the additional commonly available financing support options for legal education.

What actually changes under OBBBA?

The law changes three foundational parts of federal student financing:

Annual and cumulative borrowing limits
Access to Graduate PLUS Loans
Availability of maximum borrowing limits based on enrollment intensity

For prospective students, it is important to know the borrowing category that applies to their degree program. Federal rules now make a distinction between professional programs and other graduate programs.

Federal student loan limits by ASU Law program
ASU Law program	Federal category	Annual Direct Unsubsidized Loan limit	Aggregate limit
Juris Doctor (JD)	Professional	$50,000	$200,000
Legal master’s and LLM	Graduate	$20,500	$100,000

ASU Law’s JD qualifies as a professional degree under federal rules. The legal master’s and LLM programs at ASU Law follow the graduate degree framework. These are administrative categories used to calculate federal loan eligibility and determine the applicable borrowing limit.

Students should also keep three additional points in mind:

A separate $257,500 lifetime maximum generally applies across a student’s federal borrowing history, including prior undergraduate, graduate and professional loans.
The figures in the table are maximums, not guaranteed awards. Actual eligibility may be lower based on cost of attendance, other financial aid, prior borrowing and enrollment intensity.
Graduate PLUS Loans are no longer available to new graduate or professional borrowers after July 1, 2026. Previously, these loans could help cover the difference between other financial aid and a program’s total cost of attendance.

What should prospective JD students know?

A first-time JD student borrowing after July 1, 2026, falls under the professional student limits:

Up to $50,000 annually
Up to $200,000 in aggregate graduate and professional borrowing
No access to new Graduate PLUS Loans
A $257,500 lifetime federal borrowing maximum, which generally includes previous student loans

The annual limit may impact students differently based on the amount of scholarships and other aid available. For some students, the annual federal limit of $50,000 may cover all eligible costs, while another student may have a gap in what annual federal limits will cover and overall costs. Students who have a funding gap may need to look into other funding sources to fully cover costs.

What should prospective legal master’s students know?

Students entering a legal master’s program under the new rules generally have access to:

The ASU Law graduate degree programs affected under the new financing rules include:

How does part-time enrollment affect federal loan eligibility?

Students enrolled less than full time in the 2026-2027 academic year will be subject to proration. The proration requirement applies both to new part-time students, as well as to currently enrolled students with access to prior loan rules.

In practical terms:

Full-time students may qualify for up to the applicable annual limit.
Less-than-full-time students receive a reduced annual limit based on their actual enrollment.
Students must ordinarily remain enrolled at least half time to receive a Direct Loan.

ASU identifies five credits as half-time enrollment for graduate and professional students. With the proration requirement, a student attending at approximately half the full-time course load can generally expect to receive about half the applicable annual loan limit amount.

The proration rules are especially important to note for working professionals who plan to take fewer courses. Part-time study may fit a student’s schedule and career responsibilities, but the student should calculate the financing effect before selecting a course load.

How should students build a financial plan?

Law school is an investment that is necessary to support career goals within the legal profession. Once you have an understanding of how degree type, available modalities, enrollment intensity, degree time to completion and cost of attendance may impact your options for funding your education, it is important to plan financially so you can focus on reaching your long-term goals.

Here are a few things to consider when creating your financial plan:

You will need to be able to cover tuition and fees as well as living and necessary expenses during enrollment.
Scholarships and grants, whether school-based or from outside organizations, can help defray some of your tuition and fees costs. It is important to know the processes for applying for scholarships, understand the parameters of the scholarship, and apply broadly for scholarships.
Start as early as possible. You will need to submit your FAFSA to receive federal loans, and it is helpful to understand your financial history and work to have your finances in order before you start law school. It is beneficial to check your credit, which may be assessed as part of the loan application process.
Budget for your anticipated expenses for starting law school, the academic year, and summers. Living frugally and spending wisely will help you maintain your budget.
Borrow carefully by comparing interest rates, fees, plans, and terms.

Most students utilize multiple funding options to finance their legal education. If your goal is to practice law or legal knowledge is an imperative to your work, careful financial planning is the best way to ensure that you can achieve your dreams.

How can ASU help students through the transition?

The first step is identifying which rules apply to your program and enrollment plan. ASU Law’s financial aid resources can help students:

Understand their annual and aggregate limits
Estimate how part-time enrollment may affect eligibility for and availability of federal loans
Review scholarships, federal aid, private loans and other payment resources
Consider the financial consequences of changing programs or enrollment

Because federal implementation guidance can continue to evolve, students should use current information from ASU and Federal Student Aid.

Students should not be discouraged by the federal loan borrowing cap. A degree is the right investment if it is necessary for your career goals and will launch you to new opportunities. There are various funding sources available beyond federal financial aid.

We recommend you start early, ask questions and evaluate each borrowing decision as part of your long-term educational and career plan. And as always, ASU Law advisors are here to help. Reach out to us to discuss your options with an expert.

For more information, contact ASU Law Financial Aid at [email protected] or 480-965-4999.