Fall tuition bills are landing in inboxes right now, and for many families this one comes with a surprise. This is the first billing cycle since the new federal borrowing rules took effect on July 1, 2026. Parent PLUS loans, which used to cover whatever was left after financial aid, are now capped at $20,000 per year and $65,000 per lifetime for each child. If your family planned to borrow more than that, the bill sitting in your student's portal may show a gap you did not expect. Most fall bills are due in early or mid August, so there is still time to close that gap. This guide walks through exactly how, step by step.
Why This Fall's Bill Feels Different
For decades, Parent PLUS loans worked like a safety valve. A parent with decent credit could borrow up to the full cost of attendance, minus any aid the student received. If the bill said $38,000 after scholarships and student loans, a parent could borrow $38,000.
That changed on July 1. Under the One Big Beautiful Bill Act (OBBBA), new Parent PLUS borrowing is now limited to $20,000 per year per dependent student, with a $65,000 lifetime cap per child. The Department of Education's summer guidance and campus financial aid offices across the country have spent July explaining the new rules, but many families will not feel them until the bill arrives.
Two other numbers matter this fall:
- The Parent PLUS interest rate for 2026-27 is 9.07%, plus an origination fee of about 4.2% taken out of each disbursement.
- Private student loan rates are climbing. In late July 2026, the average fixed rate on a 10-year private loan rose to about 7.92%, according to Forbes Advisor's weekly rate report. Strong-credit borrowers can find lower rates, but weaker-credit applicants may see offers well into the double digits.
So the old fallback (borrow the whole gap through Parent PLUS) is capped, and the alternatives cost real money. That makes the next few weeks a good time to be deliberate instead of rushed.
Step 1: Read the Bill Line by Line
Before you figure out how to pay the bill, make sure the bill is right. Billing errors and missing aid are common in July and August, when schools process thousands of accounts at once. Check for:
- Missing financial aid. Compare the bill against your award letter. Grants, scholarships, and accepted federal loans should appear as pending credits. If something is missing, the most common causes are incomplete verification, an unsigned Master Promissory Note, or unfinished entrance counseling.
- Charges you can waive. Many schools automatically bill for health insurance ($1,500 to $3,500 a year at some schools). If your student is on a family plan, you can usually waive it, but the deadline is often in August and it will not waive itself.
- Optional fees. Parking, recreation passes, and dorm extras sometimes appear by default. Remove what your student will not use.
- Housing and meal plan tier. A step down in meal plan alone can save $500 to $1,000 per semester at many schools.
A 20 minute review of the bill often shrinks the gap before you spend a single new dollar.
Step 2: Confirm Your Student Has Taken Their Own Federal Loans First
Rankings
Compare private student loan options
Compare College Ave, Earnest, and Sallie Mae — with Sallie's rate matched to this program where available.
- Rank #1Editor's Pick
Parent • Undergrad
College Ave
Best for: Students who want flexible repayment options and no origination fees
- 0.25% rate reduction with auto-pay
- Four in-school repayment options
- No application, origination, or prepayment fees
- Borrow from $1,000 up to 100% of cost of attendance
Apply NowRates
Lowest Rate 2.19%
2.19% - 17.99% fixed APR, 3.89% - 17.99% variable APR
Disclosures+
College Ave's student loan products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or BTG Pactual Bank, N.A., member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply. (1) All rates include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. If a payment is returned, you will lose this benefit. Variable rates may increase after consummation. (2) As certified by your school and less any other financial aid you might receive. Minimum $1,000. (3) This informational repayment example uses typical loan terms for a freshman borrower who selects the Deferred Repayment Option with a 10-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 8.35% fixed Annual Percentage Rate (APR): 120 monthly payments of $179.18 while in the repayment period, for a total amount of payments of $21,501.54. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary. Information advertised valid as of 9/8/2026. Variable interest rates may increase after consummation. Approved interest rate will depend on creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of the Flat Repayment Option with the shortest available loan term.
- Rank #2
Parent • Undergrad
Sallie Mae
Best for: Undergraduate and graduate students, and parents, comparing competitive fixed- and variable-rate private student loans
- Competitive variable and fixed rates
- Multiple repayment options
- Cosigner release available
- No origination fees
Apply NowRates
Lowest Rate 1.95%
1.95% - 17.49% fixed APR, 3.75% - 16.95% variable APR
Disclosures+
Undergraduate School Loan/Smart Option Student Loan: Examples of typical transactions for a $10,000 Smart Option Student Loan with the most common fixed rate, Fixed Repayment Option, two disbursements, a 4-year in-school period, and a 6-month grace: For a borrower with the shortest loan term, it works out to 16.16% fixed APR, 51 payments of $25.00, 119 payments of $296.32 and one payment of $41.82, for a total loan cost of $36,578.90. For a borrower with the longest loan term, it works out to 16.38% fixed APR, 51 payments of $25.00, 177 payments of $265.54 and one payment of $173.00, for a total loan cost of $48,448.58. Loans that are subject to a $50 minimum principal and interest payment amount may receive a loan term that is less than 10 years. A variable APR may increase over the life of the loan. A fixed APR will not. Information advertised valid as of 08/25/2026. Rates: Advertised APRs for undergraduate students assume a $10,000 loan with a 4-year in-school period, a 6-month grace, and the longest loan term offered. Interest rates for variable rate loans may increase or decrease over the life of the loan based on changes to the 30-day Average Secured Overnight Financing Rate (SOFR) rounded up to the nearest one-eighth of one percent. Advertised variable rates are the starting range of rates and may vary outside of that range over the life of the loan. Interest is charged starting when funds are sent to the school. With the Fixed and Deferred Repayment Options, the interest rate is higher than with the Interest Repayment Option and Unpaid Interest is added to the loan's Current Principal at the end of the grace/separation period. To receive a 0.25 percentage point interest rate discount, the borrower or cosigner must enroll in auto debit through Sallie Mae. The discount applies only during active repayment for as long as the Current Amount Due or Designated Amount is successfully withdrawn from the authorized bank account each month. It may be suspended during forbearance or deferment. Cosigner Release: Only the borrower may apply for cosigner release. To do so, they must first meet the age of majority in their state and provide proof of graduation (or completion of certification program), income, and U.S. citizenship or permanent residency (if their status has changed since they applied). In the last 12 months, the borrower can't have been past due on any loans serviced by Sallie Mae for 30 or more days or enrolled in any hardship forbearances or modified repayment programs. In addition, the borrower must have paid ahead or made 12 on-time principal and interest payments on each loan requested for release. The loan can't be past due when the cosigner release application is processed. The borrower must also demonstrate the ability to assume full responsibility of the loan(s) individually and pass a credit review when the cosigner release application is processed that demonstrates a satisfactory credit history including but not limited to no: bankruptcy, foreclosure, student loan(s) in default or 90-day delinquencies in the last 24 months. Requirements are subject to change.
- Rank #3
Parent • Undergrad
Earnest
Best for: Borrowers who want a zero-fee¹ lender with flexible repayment options² across undergrad, grad, and professional school programs
- 0.25% Auto Pay³ discount plus 0.25% Loyalty⁴ discount for eligible returning borrowers
- No origination fees, late fees, or prepayment penalties¹
- Borrow $1,000⁵ to $400,000 with 5, 7, 10, 12, or 15-year terms⁶
- Four repayment options², a 9-month grace period⁷, and cosigner release for eligible borrowers⁸
Check EligibilityRates
Lowest Rate 2.29%
2.29% - 16.24% fixed APR, 4.74% - 16.60% variable APR
Disclosures+
Earnest Private Student Loans are subject to credit approval. ¹Earnest does not charge fees for origination, late payments, returned check, or prepayments. Florida Stamp Tax: For Florida residents, Florida documentary stamp tax is required by law, calculated as $0.35 for each $100 (or portion thereof) of the principal loan amount, the amount of which is provided in the Final Disclosure. Lender will add the stamp tax to the principal loan amount. The full amount will be paid directly to the Florida Department of Revenue. Certificate of Registration No. 78-8016373916-1. ²Repayment terms and repayment options available vary based on loan type. ³You can take advantage of the Auto Pay interest rate reduction by setting up and maintaining active and automatic ACH withdrawal of your loan payment from a checking or savings account. The interest rate reduction for Auto Pay will be available only while your loan is enrolled in Auto Pay. Interest rate incentives for utilizing Auto Pay may not be combined with certain private student loan repayment programs that also offer an interest rate reduction. It is important to note that the 0.25% Auto Pay discount is not available when loan payments are deferred during the interim period as a result of selecting the deferred repayment option. ⁴To be eligible for the Loyalty Discount, applicants must have previously obtained an Earnest Private Student Loan and apply using the same email address associated with that loan. Only one Loyalty Discount may be applied per eligible Earnest Private Student Loan. Not all applicants may qualify. This offer cannot be combined with Earnest’s Rate Match program. Earnest may modify or discontinue this offer at any time and without notice, however, once a Loyalty Discount is earned, it will not be taken away. ⁵Residents of Hawaii must request a loan of at least $1,501. ⁶Available interest rates are subject to change. Interest rates as of 03/19/2026. Earnest’s Loan Cost Examples: 1.) These examples provide estimates based on principal and interest payments beginning immediately upon loan disbursement. Variable annual percentage rate ("APR"): A $10,000 loan with a 15-year term (180 monthly payments of $152.84) and a 16.85% interest rate without Auto Pay (16.85% APR) would result in a total estimated payment amount of $27,511.20. For a variable loan, after your starting rate is set, your rate will then vary with the market. Fixed APR: A $10,000 loan with a 15-year term (180 monthly payments of $150.30) and a 16.49% interest rate without Auto Pay (16.49% APR) would result in a total estimated payment amount of $27,054.10. 2.) These examples provide estimates based on interest-only payments while in school. Variable interest rate: A $10,000 loan with a 15-year term (180 monthly payments of $152.84) and a 16.85% interest rate without Auto Pay (16.85% APR) would result in a total estimated payment amount of $35,515.14. For a variable loan, after your starting rate is set, your rate will then vary with the market. Your actual repayment terms may vary. Other repayment options are available. The calculation assumes that the “in-school” period is 4 years (48 months) and includes our 9 month grace period, during which the monthly payment will be $140.42 for 57 months. Fixed interest rate: A $10,000 loan with a 15-year term (180 monthly payments of $150.30) and a 16.49% interest rate without Auto Pay (16.49% APR) would result in a total estimated payment amount of $34,886.94. Your actual repayment terms may vary. Other repayment options are available. The calculation assumes that the “in-school” period is 4 years (48 months) and includes our 9 month grace period, during which the monthly payment will be $137.42 for 57 months. 3.) These examples provide estimates based on fixed $25 payments while in school. Variable interest rate: A $10,000 loan with a 15-year term (180 monthly payments of $253.39) and a 16.85% interest rate without Auto Pay (14.92% APR) would result in a total estimated payment amount of $47,035.20. For a variable loan, after your starting rate is set, your rate will then vary with the market. Fixed interest rate: A $10,000 loan with a 15-year term (180 monthly payments of $246.61) and a 16.49% interest rate without Auto Pay (14.65% APR) would result in a total estimated payment amount of $45,814.80. Your actual repayment terms may vary. Other repayment options are available. The calculation assumes that the “in-school” period is 4 years (48 months) and includes our 9 month grace period, during which the monthly payment will be $25.00. 4.) These examples provide estimates based on deferred payments. Variable interest rate: A $10,000 loan with a 15-year term (180 monthly payments of $275.17) and a 16.85% interest rate without Auto Pay (14.67% APR) would result in a total estimated payment amount of $49,530.60. For a variable loan, after your starting rate is set, your rate will then vary with the market. Fixed interest rate: A $10,000 loan with a 15-year term (180 monthly payments of $268.03) and a 16.49% interest rate without Auto Pay (14.39% APR) would result in a total estimated payment amount of $48,245.40. Your actual repayment terms may vary. Other repayment options are available. It is important to note that the 0.25% Auto Pay discount is not available when the deferred repayment option has been selected and the loan is in the interim period. The calculation assumes that the “in-school” period is 4 years (48 months) and includes our 9 month grace period, during which the monthly payment will be $0. ⁷Nine-month grace period is not available for borrowers who choose our Principal and Interest Repayment plan while in school. ⁸To qualify for automatic cosigner release, the outstanding principal balance of your loan must be paid down to 50% or less of the original principal balance. The primary borrower must have made 36 months of required payments after the end of the Interim Period. The primary borrower must meet our eligibility and minimum credit requirements. Additional terms and conditions may apply. To request cosigner release, the primary borrower must have made 12 consecutive, monthly on-time principal and interest payments (or an amount equal thereto) immediately preceding the cosigner release application. The primary borrower must satisfy certain eligibility and credit criteria at the time of application. Additional terms and conditions may apply. ⁹Includes 0.50% combined Auto Pay and Loyalty discounts. Actual rate and available repayment terms will vary based on your financial profile. Fixed annual percentage rates (APR) range from 2.79% to 16.74% (2.29% - 16.24% with Auto Pay and Loyalty discounts). Variable annual percentage rates (APR) range from 5.24% to 17.1% (4.74% - 16.6% with Auto Pay and Loyalty discounts). Earnest variable interest rate student loans are based on a publicly available index, the 30-day Average Secured Overnight Financing Rate (SOFR) published by the Federal Reserve Bank of New York. The variable rate is based on the rate published on the 25th day, or the next business day, of the preceding calendar month, rounded to the nearest hundredth of a percent plus a margin and will change on the 1st of each month. The rate will not increase more than once a month, but there is no limit on the amount that the rate could increase at one time. Our lowest rates are only available for our most credit qualified existing cosigned loan borrowers who receive the 0.25% Loyalty discount and requires selection of our shortest term offered, full principal and interest payment while in school, and enrollment in our 0.25% Auto Pay discount. Enrolling in Auto Pay is not required as a condition for approval. Interest rates are subject to change. Earnest Private Student Loans are made by FinWise Bank, Member FDIC. FinWise Bank, 756 East Winchester, Suite 100, Murray, UT 84107. Earnest student loans are serviced by Earnest Operations LLC, 300 Frank H. Ogawa Plaza, Suite 340, Oakland, CA 94612. NMLS #1204917, with support from Higher Education Loan Authority of the State of Missouri (MOHELA) (NMLS# 1442770). FinWise Bank and Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by agencies of the United States of America. © 2026 Earnest LLC. All rights reserved.
Student loans in the student's name are almost always the cheapest borrowing available. The 2026-27 undergraduate federal rate is 6.52%, well below both the Parent PLUS rate and the average private loan rate. Annual limits for dependent undergraduates are unchanged under OBBBA:
- Freshman year: $5,500
- Sophomore year: $6,500
- Junior and senior years: $7,500 each
If your student has not accepted their full federal loan offer, do that before considering any other borrowing. It requires a completed FAFSA, a signed Master Promissory Note, and entrance counseling, all done online at studentaid.gov.
Step 3: Ask About a Payment Plan Before You Borrow Anything
Nearly every college offers an installment payment plan that splits the semester bill into 3 to 5 monthly payments. Most charge a flat enrollment fee of $25 to $100 and no interest at all.
Payment plans will not create money you do not have, but they change the timing problem. A $6,000 gap due August 10 is scary. Four payments of $1,500 from August through November may be workable, especially if both parents and the student contribute. Payment plans also pair well with other strategies: you can cover part of the gap with a plan and borrow only the remainder, which shrinks interest costs for years to come.
Our guide to college payment plan interest and fees explains what to look for before you enroll.
Step 4: Chase the Money That Does Not Have to Be Repaid
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Even in late July, free money is still on the table:
- Ask the financial aid office about remaining funds. Some institutional grants and emergency funds go unclaimed each fall. A polite phone call asking "are there any funds still available for this year?" costs nothing.
- Appeal your aid if your finances changed. Job loss, reduced hours, medical bills, or a divorce since you filed the FAFSA are all valid grounds for a professional judgment appeal. Schools can adjust your aid mid-cycle.
- Look for fall-deadline scholarships. Many local scholarships (community foundations, employers, credit unions, religious organizations) have deadlines in August and September, after the big national ones have closed. Smaller awards of $500 to $2,000 get fewer applicants.
- Check employer tuition benefits. Many employers reimburse tuition for employees, and some extend scholarships to employees' children. Up to $5,250 per year in employer education assistance is tax-free, and OBBBA made that benefit permanent.
- Use 529 funds strategically. If you have a 529 plan, tuition, fees, housing, meal plans, and books are all qualified expenses. Withdrawals for this semester should happen in the same calendar year you pay the bill.
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Step 5: If You Still Need to Borrow, Compare Before You Sign
Start with our Sallie Mae review, College Ave review, and Citizens review for parent loan details, and see our Earnest review and SoFi review if refinancing later is part of your plan.
Once the gap is as small as you can make it, compare the remaining borrowing options honestly:
Parent PLUS up to the cap
Parent PLUS at 9.07% is expensive, but it comes with federal protections: deferment, forbearance, discharge if the parent or student dies or becomes disabled, and access to income-contingent repayment if you consolidate. For many families, using PLUS up to the $20,000 cap is still the right first move for the parent's share.
Private student loans for the remainder
If the gap exceeds the PLUS cap, a private loan may be the only borrowing option left. Rates vary widely with credit, from about 5% to over 17%. A creditworthy cosigner usually lowers the rate. Before applying, read our list of 8 questions to ask before comparing private student lenders, and get quotes from at least three lenders. Prequalification uses a soft credit check, so shopping around will not hurt your score.
What not to do
Avoid credit cards, 401(k) loans, and home equity lines as first resorts. Each carries risks (high rates, lost retirement growth, or your house as collateral) that student loans do not.
For a deeper look at this decision, see When Parent PLUS Isn't Enough: How to Fill the Gap.
What If You Cannot Pay by the Due Date?
If the numbers will not work before the deadline, do not panic and do not go silent. Call the bursar or student accounts office and tell them where you stand. Ask three questions:
- Can you enroll in a payment plan now, even after the first due date?
- Is there a short grace period or late-fee waiver for families finalizing loans?
- Will a partial payment hold your student's registration?
Most schools would rather work with you than drop your student's classes. What triggers problems is unpaid balances with no communication. If aid is still processing, ask the financial aid office for a note on the account so the bursar knows money is on the way.
Whatever you do, do not let your student get dropped from classes without a conversation first. Reinstatement is often harder than prevention.
Start Spring Semester Planning Now
The spring bill arrives in December, and it will look a lot like this one. A few moves now make it easier:
- Split remaining borrowing across semesters. The $20,000 Parent PLUS cap is annual, so plan how much of it you need for spring before you use it all on fall.
- Set a monthly savings target. Even $200 a month from September through December is $800 off the spring gap.
- Put scholarship deadlines on the calendar. Many spring and next-year scholarships open in the fall.
- File the 2027-28 FAFSA when it opens. Filing early keeps your student first in line for limited state and institutional funds.
A written plan beats a scramble every time. Create your free CollegeLens plan to map out all four years of costs, aid, and borrowing in one place, so next semester's bill is a line item you expected instead of a surprise.
The Bottom Line
This is the first fall bill season under the new federal borrowing caps, and the families who come through it best will be the ones who slow down and work the problem in order: verify the bill, max out the student's cheaper federal loans, use a payment plan to buy time, chase money that does not have to be repaid, and only then borrow the true remainder at the best rate you can find. Paying for college is stressful, and a surprise gap in August makes it more so. But a gap with a plan is just a to-do list.
You have more options than the bill makes it feel like. Take them one step at a time.
Related on CollegeLens
- College Ave Student Loan Review 2026
- Citizens Bank Student Loan Review 2026
- Sallie Mae Student Loan Review 2026
-- Sravani at CollegeLens
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