Federal loans cut for degree programs with poor earnings
A federal policy that took effect July 1 prevents students from using federal loans for degree programs whose graduates earn less than the average high-school graduate four years after finishing. The Big Beautiful Bill bars federal aid to programs that fail the earnings test for two of three consecutive years. Education Department data and HEA Group analysis flagged 804 programs, roughly 2 percent of undergraduate programs and about 40,000 graduates a year, including music and fine arts programs at institutions such as the University of Southern California, Juilliard and the New School. Supporters call it student and taxpayer protection; critics say it may not address heavy debt loads.
Federal loans barred for programs whose graduates earn less than high-schoolers
Context
A federal provision in the Big Beautiful Bill took effect on July 1. The department will compare graduate earnings to high school wages using tax records. Some colleges may change programs or see enrollment and borrowing shifts next.
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