Graduate Opportunity and Affordable Loans Act

To modify the annual and aggregate limits of Federal Unsubsidized Stafford Loans for graduate and professional students, and to terminate Federal Direct PLUS Loans for graduate and professional students, and for other purposes. 1. Short title This Act may be cited as the Graduate Opportunity and Affordable Loans Act 2. Loan reforms Section 455 of the Higher Education Act of 1965 ( 20 U.S.C. 1087e (1) in subsection (a)— (A) in paragraph (3)(A)— (i) in the matter preceding clause (i), by striking part B part B— (ii) beginning in the matter preceding clause (i), by striking for any period professional student (i) for any period of instruction beginning on or after July 1, 2012, a graduate or professional student ; and (iii) in clause (ii), by inserting for any period of instruction beginning on July 1, 2012 and ending on June 30, 2024 (subject to paragraph (4)(C)), the maximum annual (B) by adding at the end the following: (4) Graduate and professional annual and aggregate limits for Unsubsidized Stafford loans beginning July 1, 2024 (A) Annual limits beginning July 1, 2024 Subject to subparagraph (C), beginning on July 1, 2024, the maximum annual amount of Federal Direct Unsubsidized Stafford loans— (i) a graduate student, who is not a professional student, may borrow in any academic year (as defined in section 481(a)(2)) or its equivalent shall be $20,500; and (ii) a professional student may borrow in any academic year (as defined in section 481(a)(2)) or its equivalent shall be $40,500. (B) Aggregate limits beginning july 1, 2024 Subject to subparagraph (C), beginning on July 1, 2024, the maximum aggregate amount of Federal Direct Unsubsidized Stafford loans— (i) a graduate student, who is not a professional student, may borrow is $65,000, in addition to the amount borrowed for undergraduate education; and (ii) a professional student may borrow is $130,000, in addition to the amount borrowed for undergraduate education. (C) Phase out provisions Notwithstanding the date of the applicability of the limits set forth in this paragraph, an eligible graduate student, including a professional student, who received a disbursement of a Federal Direct Unsubsidized Stafford loan after June 30, 2023, and before July 1, 2024, for the 2023–2024 award year, may receive a Federal Direct Unsubsidized Stafford loan for the 2024–2025 award year in amounts that are subject to the annual and aggregate loan limits applicable prior to July 1, 2024, if the borrower did not graduate prior to the 2024–2025 award year. (D) Definitions In this paragraph: (i) Graduate student The term graduate student (ii) Professional student The term professional student (iii) Postbaccalaureate certificate; master's degree; doctor's degree; doctor's degree professional-practice The terms postbaccalaureate certificate master’s degree doctor’s degree doctor’s degree professional-practice (5) Termination of authority to make Federal Direct PLUS loans to graduate and professional students (A) In general Notwithstanding any other provision of law, for any period of instruction beginning on or after July 1, 2024, a graduate student (including a professional student) shall not be eligible to receive a Federal Direct PLUS Loan under this part for enrollment in a program of graduate or doctor's degree professional-practice education. (B) Phase out provisions Not later than 30 days after the date of enactment of the Graduate Opportunity and Affordable Loans Act (C) Definitions The definitions in paragraph (4)(D) shall apply to this paragraph. (6) Institutionally-determined limits Notwithstanding any other provision of this part, an eligible institution (at the discretion of a financial aid administrator at the institution) may prorate or limit the amount of a loan a student who is enrolled in a program of study at that institution for a period of instruction beginning on or after July 1, 2024, may borrow under this part for an academic year, as long as any proration or limit is applied consistently to all borrowers entering such program of study. .

Summary: Graduate Opportunity and Affordable Loans Act This bill limits federal student loan borrowing for graduate and professional students. Specifically, the bill terminates the ability of a graduate or professional student to receive a Direct PLUS Loan. Institutions of higher education (IHEs) must notify their prospective and enrolled graduate and professional students that Direct PLUS Loans terminate on June 30, 2024. Additionally, the bill reduces the aggregate loan limits for Direct Unsubsidized Loans. In particular, the bill establishes the aggregate loan limit as $65,000 for a graduate student (down from $138,500) and $130,000 for a professional student (down from $138,500). The bill allows IHEs to set lower loan limits.