Important Updates About Federal Financial Aid

Several recent U.S. Department of Education policy changes may impact some Penn State World Campus students who use federal financial aid to pay for their education.

Students who use federal financial aid (or plan to do so) are strongly encouraged to review this information carefully, check their financial aid updates in LionPATH, review a list of frequently asked questions, and contact the World Campus Financial Aid Office with any questions or concerns.

PLUS Loans for Graduate or Professional Students

This update affects students who had a Grad PLUS loan in the past year.

• Starting July 1, 2026, Direct PLUS Loans are no longer available to graduate or professional students unless they qualify for the limited exception.
• To qualify, you must have been enrolled in your program of study as of June 30, 2026; have borrowed a Direct Loan for that program prior to July 1, 2026; and remain continuously enrolled in the same program at the same school.
• Check the Federal Student Aid website for additional information and updates.

Parent PLUS Loans

This update affects students whose parents had a Direct PLUS loan on their behalf in the past year. A Direct PLUS Loan is commonly referred to as a Parent PLUS Loan when made to a parent borrower.

The parent borrower qualifies for the limited exception and is subject to the prior Direct PLUS Loan limits if the dependent undergraduate student on whose behalf they are borrowing the loan:

• was enrolled in a program of study at an institution as of June 30, 2026
• borrowed a Direct Loan for that program of study prior to July 1, 2026, (or they borrowed a Direct PLUS Loan on behalf of the dependent student for such program of study)
• is currently enrolled at the same institution in the same program of study
• has not stopped their enrollment in the same program at the same institution at any point as of July 1, 2026

The student can change majors and the parent borrower will remain eligible for the limited exception. However, if the student changes credential levels, that will cause the parent to lose eligibility for the limited exception.

Parent borrowers who qualify for this limited exception may, for each academic year, borrow up to — but not more than — the amount of their student’s estimated cost of attendance minus the amount of any other financial aid received for that academic year. Each school determines the cost of attendance using federal guidelines.

Students Enrolled Less than Full-Time

Starting July 1, 2026, the government is introducing a strict Schedule of Reduction (SOR). If you are enrolled less than full-time, your federal loans will be automatically prorated based on your exact number of credits.

To qualify for the full loan, undergraduate students must take 24 credit hours an academic year (12 credits per semester), while graduate students must take 18 credits an academic year (nine credits per semester).

Students who don’t plan to take enough credits to meet the full-time threshold should keep in mind that they will only be eligible for a prorated amount of federal student loans.

Important reminder: dropping classes mid-semester can have financial implications, and — based on the SOR guidelines — may trigger a reduction to your future loan disbursements or require you to repay funds that were already released. If you drop a course after the semester begins, the financial aid office will recalculate your aid eligibility for that semester.