2026 changes to US Federal Student Loans
As of 1 July 2026, the 'One Big Beautiful Bill Act' (H.R.1) introduced significant changes to the US Federal Student Aid programme.
We have updated our website information to reflect the changes to the US Federal Student Aid programme.
If you are a new student, a current student starting a new programme, or a current student who is applying for US Federal Student Aid for the first time on or after 1 July 2026, the information on this website applies to you.
Current students who received US Federal Student Aid before 1 July 2026 should contact the US Financial Aid team at usfinancialstudentaid@massey.ac.nz to confirm their ongoing eligibility.
As a US citizen or resident, you're likely to get different types of federal loans to make your studies at Massey more affordable. The US Department of Education is your lender if you take out a federal loan as part of your financial aid package.
If you need to borrow money for your degree, apply for federal loans first. They have better interest rates and other benefits. If you still need money to study, you can look into private loans.
Federal Student Aid: Advantages of a federal student loan over a private student loan
Direct loans
There are 2 types of federal student loans – Direct Subsidised and Direct Unsubsidised. The loans have a limit on how much you can borrow each year and in total – the aggregate limit.
Federal Student Aid: Direct Subsidized and Direct Unsubsidized Loans
Direct subsidised loans
These loans are:
- low-interest loans for undergraduates
- based on your financial needs
- subsidised by the US Government, which pays the loan interest at certain times.
If you have a direct subsidised loan, the US Government pays your loan interest during:
- your studies, which must be at least half-time or 30 credits a semester
- the 6-month grace period after you finish your studies
- any deferment you agree with your lender.
You can get direct subsidised loans for up to 150% of the published length of your degree. This 'maximum eligibility period' is a condition of financial aid.
Meet financial aid conditions – maximum eligibility period
Check how long your degree is expected to take to work out your maximum eligibility period.
Direct unsubsidised loans
These loans are:
- for undergraduates, postgraduates and students taking professional qualifications
- not based on your financial needs.
With a direct unsubsidised loan, your loan interest starts when you first get disbursements of your loan money. You can choose to pay the interest monthly or add it to your total loan. If you add the interest to the amount you borrow – the principal – you pay back the interest when you start repayment.
Annual loan limit for undergraduates
Discover the most you could take out in federal loans for each year of an undergraduate degree. How much you can borrow depends on whether you are a dependent or an independent student.
Borrowing money as a dependent or an independent student
Dependent students
This table shows the maximum you can borrow in direct federal loans as a dependent student for each year of your degree. The sums are in US dollars.
| Year of study | Subsidised loan (USD) | Unsubsidised loan (USD) | Total loan limit for the year (USD) |
|---|---|---|---|
| 1st year | $3,500 | $2,000 | $5,500 |
| 2nd year | $4,500 | $2,000 | $6,500 |
| 3rd year and above | $5,500 | $2,000 | $7,500 |
Independent students
This table shows the maximum you can borrow in direct federal loans as an independent student for each year of your degree. The sums are in US dollars.
| Year of study | Subsidised loan (USD) | Unsubsidised loan (USD) | Total loan limit for the year (USD) |
|---|---|---|---|
| 1st year | $3,500 | $6,000 | $9,500 |
| 2nd year | $4,500 | $6,000 | $10,500 |
| 3rd year and above | $5,500 | $7,000 | $12,500 |
Maximum loan limit for undergraduate students
This table shows the total loan limits for subsidised loans and the maximum amount undergraduate students can borrow through the Subsidized and Unsubsidized Loan programs, depending on what kind of student you are. The sums are in US dollars.
| Student type | Subsidised loan (USD) | Total loan limit (USD) |
|---|---|---|
| Dependent undergraduate student | $23,000 | $31,000 |
| Independent undergraduate student | $23,000 | $57,500 |
Annual loan limit for postgraduates
If you want to study a postgraduate degree, you:
- can take out only direct unsubsidised federal loans
- are classed as an independent student.
This table shows the maximum you can borrow each year in a direct unsubsidised loan. The sums are in US dollars.
| Year of study | Unsubsidised loan (USD) | Total loan limit for the year (USD) |
|---|---|---|
| 1st year and above | $20,500 | $20,500 |
Maximum loan limit for qualifications for postgraduate students
This table sets out the maximum or aggregate limit of an unsubsidised loan you can take out for your postgraduate qualification (master or PhD).
| Student type | Total unsubsidised loan limit (USD) |
|---|---|
| Postgraduate students | $100,000 |
Annual loan limits for professional students
If you are studying in the professional phase of the Bachelor of Veterinary Science qualification, you:
- can take out only direct unsubsidised federal loans
- are classed as an independent student.
This table show the maximum you can borrow each year in a direct unsubsidised loan. The sums are in US dollars.
| Year of study | Unsubsidised loan (USD) | Total loan limit for the year (USD) |
|---|---|---|
| 1st year and above | $50,000 | $50,000 |
Maximum loan limit for professional students
This table sets out the maximum or aggregate limit of an unsubsidised loan you can take out for the professional phase of the Bachelor of Veterinary Science qualification. Previous loan borrowing at the graduate or professional level of study will be included in your maximum loan limit.
| Student type | Total unsubsidised loan limit (USD) |
|---|---|
| Professional students | $200,000 |
PLUS loans
The federal government offers Parent PLUS.
Parent PLUS
The Parent PLUS loans are for parents and guardians of dependent undergraduate students.
If you are a parent or guardian applying for a Parent PLUS loan, you need to:
- go through credit checks
- give permission before your child gets funds for their living costs
- start repayments once the funds are given out because there is no deferment or grace period.
Private study loans
You can apply to private lenders for loans to cover your education costs. You may want to think about private study loans if:
- your federal loan doesn't cover your full study and living costs
- you don't qualify for PLUS loans – for example, you're an independent undergraduate.
Banks and financial institutions often have the same tests as the federal government when deciding whether and how much to lend to students or parents. But when you apply for a private student loan, you will have a credit check.
If you don't have a strong credit profile, you can apply with a loan co-signer who has good credit, if you can. This may improve your chances of getting a loan, and at a lower interest rate.
Bear in mind that loans from US financial institutions are in US dollars, while you need to pay your fees in New Zealand dollars. When you're thinking about how much to borrow, consider the currency exchange rate.
An example of a private lender is Sallie Mae Student Loans.
Contact us for help
Contact us for questions about US Financial Aid at usfinancialstudentaid@massey.ac.nz
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