The enactment of the One Big Beautiful Bill Act introduces significant reforms to federal student loan programs, particularly affecting law students and the broader legal education landscape. A key provision of the legislation is the elimination of Graduate PLUS loans, a primary financing tool for many pursuing legal education. Concurrently, the Act imposes borrowing caps on federal loans: $50,000 annually and a $200,000 lifetime limit for professional students, including those in law programs. ([americanbar.org](https://www.americanbar.org/groups/law_students/resources/student-lawyer/personal-financial/future-law-school-loans-one-big-beautiful-bill-act/?utm_source=openai))
These changes present substantial challenges for law students, especially given the escalating costs of legal education. For instance, the median annual tuition for law schools has reached $42,780, excluding additional expenses such as housing and materials. ([conference-board.org](https://www.conference-board.org/research/CED-Newsletters-Alerts/one-big-beautiful-bill-impact-on-education?utm_source=openai)) With the new federal loan limits, students may find it increasingly difficult to finance their education without resorting to private loans, which often come with higher interest rates and less favorable repayment terms.
The American Bar Association has expressed concern that these static caps, when adjusted for inflation and normal price increases, effectively represent shrinking caps. ([americanbar.org](https://www.americanbar.org/advocacy/governmental_legislative_work/publications/washingtonletter/july-25-wl/pslf-update-0725wl/?utm_source=openai)) This could deter individuals from middle and upper-middle-class backgrounds from pursuing legal education, potentially impacting the diversity and accessibility of the legal profession.
In response to these developments, law schools and prospective students must explore alternative financing strategies. This may include seeking institutional scholarships, considering income-share agreements, or advocating for policy adjustments to address the financial barriers imposed by the new federal loan caps.