January 2026

‘Face to Face’: Student Loans

January 21, 2026   |   Alex Likowski

Since early December, the headlines have been grim. In The Wall Street Journal: “How the U.S. is Tightening the Reins on Federal Student Loans.” In Newsweek: “Warning Issued for Student Loan Borrowers.” In Bloomberg: “How the Trump Administration is Putting the Squeeze on Student Borrowers.”

A big part of that squeeze is a change on the limits on student borrowing. Last summer’s One Big Beautiful Bill Act eliminates the existing GradPlus loan program for new students after July 1. It also imposes annual limits on new borrowers — $50,000 for “professional” degree students, and $20,500 for all other graduate students. The lifetime limits are $200,000 and $100,000, respectively.

The controversy over the “professional” designation stems from the fact that federal rules — which have not changed — categorize only a limited number of degrees as “professional.” The relevant degrees at the University of Maryland, Baltimore (UMB) are the MD, DDS, JD, and PharmD degrees. Others, like graduate nursing degrees, Doctor of Physical Therapy, and Master and Doctor of Social Work degrees are not included on the “professional” list.

As you might expect, nursing advocacy groups in particular were quick to respond, arguing that any policy that may dissuade potential nursing students will only exacerbate a serious and growing nursing shortage. “We have a primary care crisis in this country,” said Deborah Trautman, president and chief executive officer of the American Association of Colleges of Nursing. “The omission is not only harmful for nursing; the omission is not good for anyone who needs health care.”

The U.S. Department of Education (DoED) defended the classifications saying the categories are merely an “internal definition” and “have no bearing on whether a program is professional in nature or not.” DoED argued that 95 percent of nursing students borrow below the new limit, and placing a cap on loans for graduate nursing programs will force colleges to reduce program costs and thereby reduce future student debt.

So, how many students will be impacted by the new limits? According to the Federal Reserve Bank of Philadelphia, about 28 percent of graduate borrowers nationally would have exceeded the new limits in recent years. And about four in 10 of those probably wouldn’t qualify for private financing without a co-signer. There are also parts of the new federal rules that impact existing student borrowers who now hold more than $1.6 trillion in loans. Many of the existing repayment plans are being phased out and replaced by a new plan called RAP, which includes income-driven payments of between 1 percent and 10 percent of a borrower’s income. Also, starting this year, most student loan forgiveness is taxable as federal income. And the government announced, but decided on Friday to pause, wage garnishments for borrowers in default.

In a media interview in late November, Secretary of Education Linda McMahon explained that all of these actions are intended to reduce the cost of a college education and push students to enter careers with higher returns on investment or opt out of higher education entirely.

“When you think about the fact that a university could just simply say, this is how much it costs to come and get this program, and then a student could borrow that amount, what incentive is there for colleges and universities then to reduce their cost?” she said, adding, “I don’t think everyone needs a four-year college education. We have to change that thinking because today we have many jobs that are available for our skilled workforce — about 700,000 openings in the skilled workforce. Students can go right into those kinds of programs with community colleges or trade schools and get into the economy and start making money for themselves.”

As for that return on investment, the DoED is also putting pressure on schools to ensure graduates are earning substantially more money than they would have without their degree. On Jan. 12, a Department of Education committee approved another new rule requiring that all higher ed programs face an earnings premium test. When and if that rule gets final approval, programs whose graduates earn too little two out of three years would be cut off from federal student loans.

On Jan. 20, UMB Provost and Executive Vice President Roger J. Ward, EdD, JD, MSL, MPA, hosted a special hybrid edition of the University’s Face to Face program. He was joined by Patricia Scott, assistant vice president of enrollment administration and University registrar. The two discussed the status of student financing for existing students as compared with students enrolling after July 1, 2026, including the new RAP repayment program, a DoED plan to implement a degree program earnings test, loan forgiveness, and alternative financing. They also answered questions from the in-person and virtual audience.

Watch the entire program by accessing the link at the top of this page.