According to the American Veterinary Medical Association (AVMA), “thirty-nine percent of graduating veterinarians reported having debt between $200,000 and $400,000 in 2024, with just under 16.6% having no debt at all. However, the same percentage (16.6%) of last year’s veterinary graduates had educational debt of $300,000 or higher.”
Between tuition, academic materials, and living expenses, the cost of attending veterinary school in the U.S. amounts to hundreds of thousands of dollars per individual. Facing significant costs, the majority of veterinary students rely on some form of federal financial aid to help cover their schooling expenses. However, the recently passed One Big Beautiful Bill Act (OBBBA) makes several significant changes to the student loan landscape in our country. This article discusses one of the major student loan changes imposed by the OBBBA—new limits on federal financial aid—and how this policy change might impact veterinary students and the industry as a whole.
Below are the new federal student loan limits set by the OBBBA, as reported by the American Veterinary Medical Association (AVMA):
- Beginning with loans disbursed after July 1, 2026, professional students, including veterinary students, may borrow up to $50,000 per year in Direct Unsubsidized Loans, with a lifetime cap of $200,000. Graduate students are limited to $20,500 a year, with a maximum aggregate limit of $100,000.
- Parent PLUS Loans, which are unsubsidized federal loans available to parents supporting their dependent undergraduate children, are now limited to $20,000 annually per student, up to a lifetime total of $65,000 per student.
The OBBBA also establishes a lifetime federal student loan borrowing cap of $257,500, excluding Parent PLUS loans.
As of July 1, 2026, the OBBBA also eliminates the Graduate PLUS Loan Program, which allows graduate and professional students to borrow up to the full cost of attendance. According to the Association of American Medical Colleges (AAMC), nearly half of all medical students rely on Grad PLUS loans to supplement the cost of medical school.
The changes to federal student loans under the OBBBA could reshape educational financing for many veterinary students. Many are concerned that the new caps on federal borrowing and the elimination of the Grad PLUS program will limit financing options for professional students facing significant educational costs. With limited access to federal loans, some students may need to turn to private loans to help cover the cost of their education. Private loans can come with higher interest rates, stricter terms for borrowing and repayment, and more stringent eligibility requirements. These financial hurdles could lead some prospective veterinary students to delay or reconsider their educational plans altogether. As a result, the ripple effects of these policy changes may ultimately impact the broader veterinary workforce and industry as a whole.
Time will tell how the changes to federal borrowing under the OBBBA will impact veterinary students’ financial outlook and educational decisions. But for now, prospective students should consider the new federal loan policies when making their educational and financial plans. RBT CPAs will continue to monitor the effect of federal policy changes on the veterinary industry. As always, RBT’s veterinary accounting team is here to support all of your practice’s accounting, tax, audit, and advisory needs. Contact us today to find out how we can be Remarkably Better Together.