SEC. 2. INCREASING UNSUBSIDIZED STAFFORD LOAN LIM-
ITS FOR UNDERGRADUATE AND GRADUATE 
STUDENTS. 
(a) AMENDMENTS.—Subsection (d) of section 428H 
of the Higher Education Act of 1965 (20 U.S.C. 1078– 
8(d)) is amended to read as follows: 
‘‘(d) LOAN LIMITS.— 
‘‘(1) IN GENERAL.—Except as provided in para-
graphs (2), (3), and (4), the annual and aggregate 
limits for loans under this section shall be the same 
as those established under section 428(b)(1), less 
any amount received by such student pursuant to 
the subsidized loan program established under sec-
tion 428. 
‘‘(2) LIMITS
FOR
GRADUATE
AND
PROFES-
SIONAL STUDENTS.— 
‘‘(A) ANNUAL LIMITS.—The maximum an-
nual amount of loans under this section a grad-
uate or professional student may borrow in any 
academic year (as defined in section 481(a)(2)) 
or its equivalent shall be the amount deter-
mined under paragraph (1), plus— 
‘‘(i) in the case of such a student who 
is a graduate or professional student at-
tending an eligible institution, $14,000; 
and 
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‘‘(ii) in the case of a graduate student 
enrolled in coursework specified in sections 
484(b)(3)(B) and 484(b)(4)(B), $7,000; 
except in cases where the Secretary determines, 
that a higher amount is warranted in order to 
carry out the purpose of this part with respect 
to students engaged in specialized training re-
quiring exceptionally high costs of education, 
but the annual insurable limit per student shall 
not be deemed to be exceeded by a line of credit 
under which actual payments by the lender to 
the borrower will not be made in any years in 
excess of the annual limit. 
‘‘(B) AGGREGATE LIMIT.—The maximum 
aggregate amount of loans under this section a 
student described in subparagraph (A) may 
borrow shall be the amount described in para-
graph (1), adjusted to reflect the increased an-
nual limits described in subparagraph (A), as 
prescribed by the Secretary by regulation. 
‘‘(3) LIMITS
FOR
UNDERGRADUATE
DEPEND-
ENT STUDENTS.— 
‘‘(A) ANNUAL LIMITS.—The maximum an-
nual amount of loans under this section an un-
dergraduate dependent student (except an un-
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dergraduate dependent student whose parents 
are unable to borrow under section 428B or the 
Federal Direct PLUS Loan Program) may bor-
row in any academic year (as defined in section 
481(a)(2)) or its equivalent shall be the sum of 
the amount determined under paragraph (1), 
plus $2,000. 
‘‘(B) AGGREGATE LIMITS.—The maximum 
aggregate amount of loans under this section a 
student described in subparagraph (A) may 
borrow shall be $31,000. 
‘‘(4) LIMITS
FOR
UNDERGRADUATE
INDE-
PENDENT STUDENTS.— 
‘‘(A) ANNUAL LIMITS.—The maximum an-
nual amount of loans under this section an un-
dergraduate independent student, or an under-
graduate dependent student whose parents are 
unable to borrow under section 428B or the 
Federal Direct PLUS Loan Program, may bor-
row in any academic year (as defined in section 
481(a)(2)) or its equivalent shall be the sum of 
the amount determined under paragraph (1), 
plus— 
‘‘(i) in the case of such a student at-
tending an eligible institution who has not 
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completed such student’s first 2 years of 
undergraduate study— 
‘‘(I) $6,000, if such student is 
enrolled in a program whose length is 
at least one academic year in length; 
or 
‘‘(II) if such student is enrolled 
in a program of undergraduate edu-
cation which is less than one academic 
year, the maximum annual loan 
amount that such student may receive 
may not exceed the amount that bears 
the same ratio to the amount specified 
in clause (i) as the length of such pro-
gram measured in semester, trimester, 
quarter, or clock hours bears to one 
academic year; 
‘‘(ii) in the case of such a student at 
an eligible institution who has successfully 
completed such first and second years but 
has not successfully completed the remain-
der of a program of undergraduate edu-
cation— 
‘‘(I) $7,000; or 
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‘‘(II) if such student is enrolled 
in a program of undergraduate edu-
cation, the remainder of which is less 
than one academic year, the maximum 
annual loan amount that such student 
may receive may not exceed the 
amount that bears the same ratio to 
the amount specified in subclause (I) 
as such remainder measured in semes-
ter, trimester, quarter, or clock hours 
bears to one academic year; and 
‘‘(iii) in the case of such a student en-
rolled in coursework specified in sections 
484(b)(3)(B) and 484(b)(4)(B), $6,000 for 
coursework necessary for enrollment in an 
undergraduate degree or certificate pro-
gram. 
‘‘(B) AGGREGATE LIMITS.—The maximum 
aggregate amount of loans under this section a 
student described in subparagraph (A) may 
borrow shall be $57,500. 
‘‘(5) CAPITALIZED INTEREST.—Interest capital-
ized shall not be deemed to exceed a maximum ag-
gregate amount determined under subparagraph (B) 
of paragraph (2), (3), or (4).’’. 
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(b) EFFECTIVE DATE.—The amendments made by 
this section shall be effective for loans issued on or after 
July 1, 2008. 
SEC. 3. GRACE PERIOD FOR PARENT PLUS LOANS. 
(a) AMENDMENT.—Section 428B(d) (20 U.S.C. 
1078–2(d)) is amended by amending paragraphs (1) and 
(2) to read as follows: 
‘‘(1) COMMENCEMENT
OF
REPAYMENT.—Re-
payment of principal on loans made under this sec-
tion shall— 
‘‘(A) commence not later than— 
‘‘(i) 60 days after the date such loan 
is disbursed by the lender, except as pro-
vided in clause (ii); and 
‘‘(ii) if agreed upon by a parent bor-
rower, the day after 6 months after the 
date the student for whom the loan is bor-
rowed ceases to carry at least one-half the 
normal full-time academic workload (as de-
termined by the institution); and 
‘‘(B) be subject to deferral during any pe-
riod during which the graduate or professional 
student or the parent meets the conditions re-
quired for a deferral under section 427(a)(2)(C) 
or 428(b)(1)(M). 
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