Education Department loan-cap plan for advanced degrees faces third court block

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Highlights

U.S. District Judge Michael Simon issued a preliminary injunction blocking the Department of Education from enforcing new federal loan caps on certain advanced degree programs.
The proposed rule, set for July 1, would have limited 11 professional programs to a $200,000 lifetime cap and other advanced degrees to a $100,000 cap.
Multiple court rulings have halted the department’s narrower definition of professional degrees, prompting an expanded list of 30 programs eligible for higher borrowing limits during ongoing litigation.

Oregon injunction targets borrowing-cap rule

As first reported by Business Insider, U.S. District Judge Michael Simon ruled that the Department of Education exceeded its authority by seeking to restrict federal lending access for certain professional degree programs.

Simon issued a preliminary injunction against the department's proposed definition of "professional" and ordered naturopathic medicine to qualify for the higher borrowing limit. He said the harm to students and schools is imminent because prospective students are deciding now whether they can afford to enroll for the coming academic year.

The department had planned to put the rule into effect on July 1. Under that plan, 11 professional programs, including medicine and dentistry, would have qualified for a $200,000 lifetime borrowing cap, while other advanced programs, including nursing and social work, would have faced a $100,000 cap.

Broader impact on schools and borrowers

The Oregon case follows challenges from colleges, students and naturopathy groups that argued the narrower list of professional degrees would push some borrowers toward private loans with higher interest rates and no access to federal loan-forgiveness programs.

Those groups also said the policy could reduce enrollment and hurt school revenue if students decide they cannot finance their education under the lower caps. Lawmakers and advocates had separately objected that some excluded programs require higher borrowing limits to cover training costs.

At the end of June, another court decision also blocked the department's narrowed definition of a professional degree from taking effect. After that ruling, the department published an updated list of 30 programs eligible for the higher borrowing limit while the litigation continues, and said in a Federal Student Aid notice that students should contact their schools to understand how the court decisions affect them.

Our earlier coverage focused on Pakistan’s push to expand bank credit for priority sectors, including housing, agriculture and SMEs, with specific lending targets set through 2027. The piece explained how the government is linking banks’ access to incentives to stronger lending performance, while also pursuing regulatory reforms and risk-sharing measures to widen access to financing.

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