Tough Credit

From Inside Higher Ed: ...The Senate version of the reconciliation bill, which President Donald Trump has urged Congress to pass as early as next week, would cap professional degree loans at $200,000 and all other graduate loans at $100,000. Both the House and the Senate also proposed completely eliminating Grad PLUS, an unsubsidized federal loan with no borrowing limit that has helped students from modest backgrounds pay for graduate degrees since 2006. In the two decades since Grad PLUS was implemented, the number of Americans with a postgraduate degree has doubled, according to 2021 Census data.

...Proponents of the loan program argue that growth is a sign of its success in expanding access; its critics say it’s because colleges saw an opportunity to boost enrollment in highly profitable programs. Federal graduate loans can be used for any postgraduate degree, including Ph.D.s. But master’s degrees and professional degrees, such as those in law and medicine, tend to be far more expensive. Graduate students also have much less access than undergraduates to institutional and public aid, meaning low- and middle-class students almost always have to borrow.

Some universities, Kelchen said, rely heavily on their graduate programs for tuition revenue—particularly large private institutions such as New York University and the University of Southern California, both of which enroll more graduate than undergraduate students...For some smaller universities that have struggled to maintain undergraduate enrollment, including Simmons University in Boston and Nova Southeastern in Florida, boosting graduate program offerings has become a key revenue stream.

...Conservatives aren’t the only ones skeptical of the current graduate loan system. Sandy Baum, a nonresident senior fellow at the liberal-leaning Urban Institute and a longtime scholar of student debt, believes that unlimited loans have enabled more students to borrow heavily to pay for degrees whose economic returns are often dubious. Graduate students make up about 15 percent of all higher education enrollment in the U.S. but account for nearly 40 percent of all outstanding student debt, according to a 2020 report from the Congressional Budget Office...

Full story at https://www.insidehighered.com/news/admissions/graduate/2025/06/26/can-graduate-programs-survive-federal-loan-caps.