Student Loans

What's Changing?

The OB3 (One Big Beautiful Bill Act) includes significant changes to federal student loans. These changes go into effect starting in Fall 2026. For the most up-to-date information from the Department of Education, visit Federal Student Aid’s OB3 Updates 

 

Student Borrowing

Before July 1, 2026, students could borrow federal loans for as long as they were enrolled. Beginning July 1, 2026, loan eligibility is based on how long your program is supposed to take, rather than the amount of time a student takes to complete it.

This matters most for part-time students. Taking 9 units per term instead of 12 or more can stretch a two-year program into four years. The loans run out after two years either way.

Program Length Caps: Loan eligibility under newer rules is tied closely to the expected length of the program. For example, a standard 2-year associate degree program provides roughly two years of maximum borrowing power; stretching that timeline part-time over 4 years means the federal loan may run out before the degree is finished.

Plus, new borrowers enrolled less than full time (fewer than 12 units) can only borrow in proportion to their unit load, similar to how Pell Grants already works.

The One Big Beautiful Bill Act (OBBBA) requires all institutions participating in the Federal Direct Loan Program to apply a federally established Schedule of Reductions (SOR). The reduction is based on the number of financial aid applicable units you are enrolled in during the academic year.

If you are not full-time (12 financial aid applicable units) on the date your Federal Direct Loan is disbursed, your loan amount will be reduced based on the amount of financial aid eligible units that are actively in session. This means that your loan disbursement will be lower than the amount you originally requested.

SOR (Schedule of Reduction)

• What Is the Schedule of Reductions (SOR)

The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, introduced major changes to federal student aid programs. Several provisions affecting student loans became effective July 1, 2026. Among the most significant changes is the introduction of the Schedule of Reductions (SOR), which requires federal student loan eligibility to be reduced based on enrollment level.

Beginning with the 2026 fall term, annual federal student loan amounts will be reduced based on enrollment. Full-time students (12 or more units) will receive a full loan amount, but part-time students (6-11 units) will receive a proportional total loan amount. Students must enroll at least half-time to be eligible for federal direct loans.

• Student Loan Amount Notifications

Students will initially be awarded with an expectation of full-time enrollment.

(EVC)The college will monitor enrollments and periodically update student loan eligibility through the term. Students should not expect immediate or ‘live’ updates to award packages based on changes made to their course schedule. It will take the financial aid office staff additional time to manually review and update the student loan amount to match the enrollment level.

• Student Loan Disbursements

At the time of loan disbursement (or financial aid refunds), the total eligible units will be evaluated, and the loan amount adjusted based on actual enrollment.

For example, if enrolled in 12 units, the student will receive 100% of the expected loan. However, if enrolled in 9 units, the student will receive a lesser amount. The amount will vary based on the individual student’s eligibility and enrollment at the time of disbursement. *Late starting course(s) are not counted towards enrollment calculation until the course(s) begins.

• Changes to enrollment

The impact of dropping, failing to start, or withdrawing courses will be considered when calculating loan eligibility. It is strongly advised that students discuss the impacts of withdrawing or dropping a course with the financial aid office.

Adding courses after the add/drop period will not result in an increase in loan amount in the same term.

It is strongly recommended to discuss course changes, when they affect the total number of units, with a member of the financial aid office prior to making the decision.

 

Protection for Existing Borrowers

Students who were enrolled and borrowing before July 1, 2026, keep their old loan limits for up to three years, or until they finish their program, whichever comes first. This is called the legacy provision. They lose this protection if they withdraw, transfer to a different program, or stay enrolled past their program’s expected length.

 

Students qualify for legacy provision if they are enrolled in a program of study as of June 30, 2026, and a Direct Loan first disbursement was made prior to July 1, 2026.   They will maintain legacy status if they are in good standing, have not graduated, and are not officially withdrawn. 

Legacy eligibility duration is limited by the Expected Time to Credential (ETTC), calculated as the lesser of three academic years or the program length minus the period the student has already completed.  Legacy status is lost if an undergraduate student changes program types or schools. 

Loan Repayment 

Student loans disbursed on or after July 1, 2026, will only be eligible for two repayment plans: Tiered Standard and the Repayment Assistance Plan (RAP).   

Effective July 1, 2027, borrowers will be allowed to rehabilitate a defaulted loan twice.   

Loans made on or after July 1, 2027, will not qualify for unemployment or economic hardship deferments, and forbearance will be strictly limited to nine months within any two-year period.   

A Direct Student loan is a long-term financial obligation which can limit your cash flow and your purchasing ability for many years into the future. We hope you will seriously evaluate whether taking on loan debt is truly necessary to make ends meet. We strongly recommend you look at your budget and expenses and evaluate where you can save money before taking on loan debt. If you decide a loan is a necessity to meet your educational expenses, borrow only what you need, this can help save your loan eligibility for when you transfer to a four year school to assist in covering the increased expenses.
Federal Student Loans can help you pay for educational expenses and help relieve stress on how to cover these educational expenses, but please remember always be informed and borrow responsibly. 
Here are some factors to think about when determining if you need to borrow and how much to borrow:

• Where do plan to attend college, living expenses are one of the most stressful and costly factors in attending college. Be sure to know or calculate a close and realistic amount of how much you will need for living expenses while you are in school.
• The cost to attend the college of your choice.  Enrollment cost can differ depending on where and what type of college you choose to attend.  The degree/ academic program you are working toward also factors in to the cost. Some programs cost more than others depending on the materials needed for the required courses. Examples: Nursing, Automotive, Cosmetology and Dental to name a few all have additional material expenses. (The more expensive the school the more expenses you will accrue and need to pay)
• Your expected graduation date.  Factoring in how long it will take you to finish can help determine how much you will need throughout your educational journey.  A good question to ask is "How long do I think it will take me to complete my goal" You answer can help you determine how much to budget for and what length of time you need to budget these expenses.
• The amount of grant and/or scholarship aid you are offered to help pay for these expenses. Always remember Grant Aid and Scholarships do not have to be paid back, only loans have to be repaid. 

These are just a few factors to consider please visit the link below for more information.
Federal Student Loans Basics for Students
We have provided informative and important information on this page that will help you make an informed decision about borrowing a student loan, how much to borrow and what type of loan to borrow. This information is to help you understand Evergreen Valley College's loan process and policies along with your options and responsibilities as a student borrower. If you have questions about any of the information on this page or if there is something that was not covered please contact the Loan processor in the Financial Aid Office.

• Students who decided to request a student loan must have completed the FAFSA process with EVC Financial Aid Office.
• Students must be enrolled at least half time at EVC (a minimum of six (6) units) during the loan period, in courses which apply to their declared major at the start of the disbursement.
• Enrollment in late-start courses may affect the timing of a student's loan disbursements. If less than six (6) units of a student's enrollment begins after the first week the semester starts, loan funds will not be disbursed until at least six (6) units begin. This does not affect student enrolled in Nursing or Automotive Program courses.
• Students must be working toward completion of an eligible Transfer, Certificate or Associate degree granting program. (English as a Second Language and Remedial Courses are not eligible classes for the loan program)
• Students must have completed six (6) degree applicable units prior to requesting a student loan. If a student does not have the required degree applicable units completed, then they must be enrolled in at least six (6) degree applicable units. English as a Second Language and Remedial Courses are not eligible classes for the loan program. (Please visit the Financial Aid office in person if you do not meet this requirement for other options)
• Students must have met Satisfactory Academic Progress (SAP) at the time a loan is requested and must continue to maintain SAP.  Students on warning status may be asked to submit an Ed Plan prior to loan disbursement.
• The Financial Aid Office may deny, on a case-by-case basis, a loan request for a student who has been in default, who has demonstrated or is demonstrating poor academic progress, and/or if a student already has a high cumulative student loan debt.
• A student is NOT eligible for a student loan or any other federal financial aid, if in DEFAULT of a prior student loan(s), or owes a repayment of Title IV financial aid to any school in the country.
• EVC students are only allowed to request to borrow up to 50% of the aggregate loan limits for their dependency status. See aggregate loan limits here.
• Students that have completed less than 30-degree applicable units are subject to the first- year loan limits.
• Students that have completed 30 or more-degree applicable units are subject to second-year loan limits. (This excludes student already accepted into the Nursing Program, if you are a student registered in the Nursing program you will automatically be considered for 2nd year loan limits)
• Students that have completed degree applicable units at a college other than Evergreen Valley College or San Jose City College must have an official transcript on file and request that the transcripts be evaluated.

If you have less than 30-degree applicable units with EVC/SJCC and want to be considered for 2nd year loan limits, an Evaluated transcript from your previous school(s) will need to be submitted with your loan request.
Note: Prior college units will only be counted if an EVC counselor has determined that the prior units apply to your current degree, certificate or academic program being pursued.

• Entrance loan counseling is required for all student loan borrowers.
• Exit interviews are required for all students when their enrollment level falls below 6 units, graduated and/or leaves school.
• As required by federal regulations, Direct Loans for new EVC borrowers are disbursed at least 30 days after the start of the loan period.
• The loan period is the standard academic year which consists of the Fall and Spring semesters. In cases where the program of study or the remainder of the program is less than a year, the loan amounts are prorated according to federal regulations. We do not process student loan in the Summer.
• Direct loans are disbursed in the same manner as federal grant aid, which means all student loans will be awarded equally between Fall/Spring semesters. All student loans, even one-semester loans, must be disbursed in at least two disbursements.
• Student will be asked to take a loan quiz based on these policies.
• Students have the right to cancel a loan at any time.
• Student loans are awarded to meet educational expenses only.

Great! Now that you read the loan policies and understand your responsibilities as a student borrower at Evergreen Valley College, you can start completing the steps to the loan request.
There are three (3) easy steps to submitting a Student Loan request, please read carefully and follow each step. If you do not complete a step this can cause a delay in reviewing your loan request and/or approval of your loan request. If you have any questions or you are having trouble completing a step, please contact our Financial Aid loan processor.

Steps to completing student loan request:

1. Complete the FAFSA and submit all other required documentation.
2. Complete Entrance Loan Counseling: https://studentaid.gov/entrance-counseling/
3. Sign the Master Promissory Note online: https://studentaid.gov/mpn/
4. After you have completed the Entrance Loan Counseling, complete the Master Promissory Note. (you may want to print a copy for your record
5. Email Josephine.Aguirre@evc.edu to request the Student Loan Application

        Student Loan request will be made available in StudentForms 

Starting August 1, 2026

If you do not meet all of the eligibility requirements and have not already submitted all required documents at the time you submit your loan request your request results will be delayed.

After all required documents have been received, notification of approval or denial is sent by e-mail within one week.