The Grad PLUS Loan Gavel Comes Down

What the End of Grad PLUS Means for Borrowing, Repayment, and Planning Ahead 

Why This Matters Now
If you are considering law school, already enrolled, or recently graduated, major changes to federal student loans are coming. A federal law signed in July 2025 restructures how graduate and professional students can borrow and repay. One of the most significant shifts is the elimination of Graduate PLUS loans for new borrowers starting July 1, 2026, along with new borrowing limits and fewer repayment options.
 
For law students, who often rely heavily on federal loans to cover high tuition and living costs, these changes can materially affect how school is funded and how debt is managed after graduation. Understanding the new rules early can help you avoid surprises and plan more confidently. 

What Is Changing for Law School Loans
Beginning July 1, 2026, federal borrowing for graduate and professional students will look very different.

Grad PLUS Loans Are Ending for New Borrowers
Grad PLUS loans previously allowed law students to borrow up to the full cost of attendance, including tuition and living expenses, after other federal aid was applied. Under the new law, Grad PLUS loans will no longer be available for loans first disbursed on or after July 1, 2026.
 
Students who are already enrolled before that date, are continuing in the same institution and program, and previously borrowed federal loans are generally allowed to keep using Grad PLUS loans for the remainder of their expected program length. 

New Federal Borrowing Limits
Once Grad PLUS is eliminated, the primary remaining federal option is Direct Unsubsidized Loans, which now come with stricter annual and lifetime caps. 

 
These limits are significantly lower than what many law students historically borrowed using Grad PLUS, especially at higher-cost schools. As a result, many students may need to rely more on scholarships, savings, or private loans, and schools may need to rethink how programs are financed. 

Changes to Repayment Plans
The new law also narrows federal repayment options for new borrowers. 

Two Main Repayment Paths for New Borrowers
Students who take out new federal loans on or after July 1, 2026 will choose between a tiered standard repayment plan or the new Repayment Assistance Plan, known as RAP. 

Under the tiered standard plan, repayment length depends on total borrowing. Borrowers with less than $25,000 repay over 10 years. Balances between $25,000 and $49,999 repay over 15 years. Loans between $50,000 and $99,999 repay over 20 years. Balances of $100,000 or more repay over 25 years. 

RAP is a new income-driven option. Monthly payments are based on adjusted gross income and family size, ranging from a flat $10 per month at very low incomes up to 10 percent of income above $100,000. Unpaid interest does not accrue as long as required payments are made, and any remaining balance may be forgiven after 30 years. 

Existing borrowers who do not take out new loans after July 1, 2026 may be able to keep current plans temporarily. However, plans like SAVE, PAYE, and ICR are scheduled to sunset by July 2028, requiring borrowers to transition to IBR, RAP, or a standard plan. 

The Impact on Future, Current, and Past Law Students 

Future Law Students Starting in 2026 or Later
If you plan to start law school in fall 2026 or beyond, you may face a funding gap. If your school’s cost of attendance, after grants and scholarships, exceeds $50,000 per year, federal loans will no longer fully cover your expenses.
Many students will need a combination of federal loans, scholarships, savings, and possibly private loans. Public Service Loan Forgiveness applies only to federal loans, not private ones, and repayment planning matters earlier because options are more limited. Practical steps include building strong credit, applying broadly for scholarships, and comparing total repayment costs across both federal and private loans, not just monthly payments. 

Current Law Students
Students already enrolled can generally continue using Grad PLUS loans through the remainder of their program, assuming they have already borrowed a federal loan. However, repayment rules will still evolve over time.
If you expect to borrow any new loans after July 1, 2026, all of your federal loans will fall under the new repayment framework, making it important to model future payments against realistic starting salaries and career paths. 

Recent Graduates
Borrowers with existing federal loans can typically remain in their current repayment plans for now. Those enrolled in SAVE, PAYE, or ICR should prepare to choose a new plan by July 2028 or they will be automatically moved to RAP. Public Service Loan Forgiveness remains available for qualifying federal loans and employment. 

Common Misconceptions to Avoid
Federal loans are not disappearing entirely. Direct Unsubsidized Loans still exist, but with tighter limits. Private loans are not interchangeable with federal loans, as they typically lack income-driven repayment, forgiveness options, and federal protections, and they require stronger credit. Higher income does not automatically make repayment easy, since large balances on standard plans can still strain early-career cash flow. 

Practical Takeaways
Map out all three years of law school costs and funding sources before enrolling. Track federal borrowing limits closely, especially if you already have undergraduate loans. Compare repayment outcomes across different career scenarios, not just best-case outcomes. Revisit repayment plan options well before required transition deadlines.

Other Resources
- Loan Simulator | Federal Student Aid- calculate federal student loan repayment options.
- Simple Loan Calculator- calculate private student loan repayment estimates.
- AccessLex Scholarship Databank a large list of available outside scholarships for law students
- Quick Tips to Boost Your Credit Score- credit will be more important than ever if you need to utilize private loans 

How Juno Can Help
As students navigate these changes, many look for clearer information and more transparency when comparing private loan options that may fill new funding gaps. Juno acts as a group negotiating platform that helps students access lower private loan rates and expanded eligibility criteria.

Joining Juno’s JD Negotiation group is free and carries no obligation to borrow. Members are alerted when loans for the 2026-2027 academic year are negotiated and can check rates with no impact to their credit score.