The U.S. Department of Education has released a new Frequently Asked Questions resource addressing the Schedule of Reductions for Direct Loan borrowers enrolled less than full time.
Beginning with the 2026–27 award year, institutions must apply the Schedule of Reductions when determining annual loan limits for certain borrowers enrolled less than full time. The new FAQ provides additional guidance to help institutions understand and implement these requirements.
The current FAQ addresses the following questions:
- What borrowers are subject to the Schedule of Reductions?
- What loans are subject to the Schedule of Reductions?
- When does the Schedule of Reductions apply?
- What academic calendars are subject to the Schedule of Reductions?
- How does the Schedule of Reductions apply to subscription-based programs?
- How does the Schedule of Reductions interact with other Title IV eligibility requirements?
- In what order should an institution apply the Schedule of Reductions and other applicable loan limit restrictions?
- How does an institution determine a borrower’s annual loan limit when enrollment changes?
- Is an institution required to recalculate a borrower’s loan eligibility when enrollment changes after a disbursement?
- How should an institution determine eligibility for a subsequent disbursement when a borrower’s enrollment changes?
- How does the Schedule of Reductions apply when existing Direct Loan proration requirements also apply?
- How can institutions avoid applying a double reduction to a borrower’s annual loan limit?
- How does the Schedule of Reductions apply when a borrower requests less than the maximum loan amount?
- How should institutions determine reduced Direct Subsidized and Direct Unsubsidized Loan amounts?
- How does the Schedule of Reductions apply to Graduate PLUS Loans for borrowers eligible under the interim exception?
- How should an institution determine the Graduate PLUS annual loan limit for an eligible less-than-full-time borrower?
- How should institutions handle changes in enrollment intensity that affect loan eligibility?
- What enrollment intensity should institutions use when determining eligibility for a Direct Loan disbursement?
- What enrollment intensity information must institutions report to the COD System?
- When is the new disbursement-level Enrollment Intensity field required?
- How should institutions report adjustments when enrollment changes affect an award or disbursement already reported to COD?
- What should an institution do when a change in enrollment requires a future disbursement to be reduced?
- What should an institution do when a change in enrollment requires a future disbursement to be canceled?
- How should institutions make corrections or adjustments in COD when a borrower’s loan eligibility changes?
View the full ED guidance here: Frequently Asked Questions: Reducing Annual Loan Limits for Less-than-Full-Time Enrollment Using the Schedule of Reductions as of July 2026
The FAQ will be updated periodically as additional questions are addressed. ED’s OBBBA information page houses the FAQ and additional OBBBA resources.
As institutions navigate the new loan limit requirements and other changes impacting Title IV administration, College Aid Services is here to help. Our team can provide support to help your institution understand the requirements and implement them effectively. Contact us here.