While college leaders saw the demographic decline coming for more than a decade, what they didn’t expect was the financial uncertainty imposed on higher education by the second Trump administration. Since last year, the White House has eliminated thousands of research grants to colleges and universities, proposed deep cuts in remaining research funding, and tightened access to student visas, leading enrollment of new foreign students at American universities to drop by more than a third—the largest annual decrease outside of the COVID pandemic. President Donald Trump’s policies have blown a hole in university budgets, forcing schools to cut spending and quickly look for new revenue everywhere.
Now, colleges and universities are bracing for the most consequential rewrite of federal higher-education policy in a generation. On July 1, provisions of the One Big Beautiful Bill Act took effect, which, among other things, will put new limits on student loans. Graduate students, who have helped fuel overall college enrollment in recent years, will no longer be able to borrow up to the full cost of attendance. Instead, loans will be capped at $20,500 per year for most students, and $100,000 for the entire degree. Only students in a handful of disciplines designated by the government as “professional,” including law and some medical fields, will be able to borrow $50,000 a year, up to a limit of $200,000. Parent borrowing for their undergraduates will also be restricted to $20,000 per student per year, with a lifetime limit of $65,000.
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