I was sitting at my desk last week, halfway through a cup of coffee that had gone cold, going over a family’s loan projections. They had three kids. The oldest was heading to college in the fall. The numbers on the screen were no longer the numbers we had planned around six months ago — and I had to pick up the phone and explain why.
That call reminded me why I do this work. Not to deliver bad news — but to make sure families aren’t blindsided by it. The rules of this game change constantly. Quietly. And the families who don’t have someone watching the landscape for them are the ones who end up surprised at the worst possible moment.
So let’s get into it. Here are the four things that matter most this week.
At a Glance
- Federal loan caps hit July 1: The One Big Beautiful Bill Act rewrites the rules on student borrowing — permanently.
- Test-optional is nearly gone at elite schools: All but one Ivy League school now requires SAT or ACT scores.
- Endowment taxes squeeze elite universities: Harvard, Yale, and Stanford face an 8% tax rate — and families will likely feel it.
- Legacy admissions compliance in the spotlight: California starts requiring annual reporting; SFFA targets Yale, Duke, and Princeton.
Financial Aid & Federal Loans
Starting July 1, 2026, the One Big Beautiful Bill Act reshapes federal student lending in ways families need to understand right now, not after the ink dries on a financial aid package.
The biggest change: there is now a $257,500 lifetime cap on all federal student loans combined. For most undergrads, that’s plenty. But families planning for graduate school on the same federal dollars need a new plan. Graduate PLUS Loans have been eliminated entirely for new borrowers. And Parent PLUS Loans are now capped at $20,000 per year and $65,000 lifetime per child — a significant reduction for families who have relied on this program to fund expensive schools.
The good news? The 2026–27 FAFSA cycle launched on time in September 2025 — the earliest opening in three years — and completion rates are up. The max Pell Grant holds at $7,395 for 2026–27. One caveat: students whose full cost of attendance is already covered by institutional, state, or private scholarships are now ineligible for the Pell Grant, even if they otherwise qualify.
If you have been leaning on Parent PLUS loans to bridge the gap at a high-cost school, the math changed on July 1. Run your four-year projections with the new caps before signing anything. Students with graduate school plans need an entirely new financial strategy. This is the moment to sit down with someone who can help you model it out.
“The families who don’t have someone watching the landscape are the ones who end up surprised at the worst possible moment.”
Admissions Policy Changes
The test-optional era is over — at least at the schools families tend to have their eye on. For the 2026–27 admissions cycle, Harvard, Yale, Dartmouth, Brown, Cornell, MIT, Caltech, Stanford, and Penn all require SAT or ACT scores. Princeton remains test-optional for one more cycle, then joins the rest. Columbia is the only Ivy with a permanent test-optional policy.
The data behind this reversal is hard to argue with. At Boston College, students who submitted test scores were admitted at roughly 28%, compared to 17% for non-submitters. At Emory, the gap was starker: 17% versus 8.6%. Universities reviewed five years of test-optional data and found a clear pattern — students who submitted scores performed better academically. The scores are back, and they matter.
Meanwhile, selective schools continue to fill more than 70% of their incoming class through Early Decision and Early Action. If your student is serious about a selective school, applying early is no longer an edge — it’s the expectation. And if you’re in the South, take note: regional universities that were once “likely” schools are now “target” and even “reach” schools, as record-breaking applicant pools push acceptance rates down across the board.
Students aiming for selective schools need strong test scores. Full stop. Prep early, test in junior year with time to retest, and don’t assume your GPA alone will carry the application. If you’re a junior right now, this should be priority one. For families considering Southern schools as “safe” choices — revisit that list. The landscape has shifted.
College Rankings & Data
The 2026 US News rankings are out. Princeton holds the top spot. MIT (#2) and Harvard (#3) complete the top three. The notable mover: the University of Chicago broke into the top 10 at #6, while Duke, Johns Hopkins, Northwestern, and Penn now share the #7 spot. On the public side, UC Berkeley reclaimed the #1 position over UCLA.
More consequential than the rankings themselves, however, is the endowment tax story unfolding right now. The One Big Beautiful Bill Act established a new tiered endowment tax: schools with endowments of $750,000–$2 million per student pay 4%; schools over $2 million per student pay 8%. Harvard, Yale, Stanford, Princeton, and MIT face the 8% rate. Notre Dame, Dartmouth, Rice, Penn, Washington University in St. Louis, and Vanderbilt face 4%.
These schools have already begun implementing hiring freezes and budget reductions. Higher education economists project tuition increases of 5–6% at affected institutions — and some schools may reduce financial aid to absorb the tax burden. The schools with the largest endowments, which were previously the most generous with aid, may become less so.
If your family has been counting on generous need-based aid from a top-ranked private university to make the numbers work, stay alert. Financial aid packages at endowment-taxed schools could look different starting this cycle. Ask schools directly about any projected changes to their aid budgets — and build a list that includes strong schools at multiple price points.
“Students who submitted test scores were admitted at nearly twice the rate of those who didn’t — and that gap is only growing.”
Legal & Legislative Developments
Students for Fair Admissions — the organization behind the landmark 2023 Supreme Court ruling ending race-conscious admissions — has turned its attention to compliance. SFFA has filed suit against Duke, Princeton, and Yale, alleging that these institutions are still considering race as a factor in admissions decisions in violation of the Court’s ruling. The litigation is in early stages, but the signal is clear: scrutiny of selective admissions practices is intensifying.
On the legacy front, California’s ban on legacy admissions preferences at private nonprofit universities, signed into law in September 2024, now requires institutions to submit annual compliance reports to the California Legislature and Department of Justice — starting this month, June 2026. Five states now have legacy bans on the books: California, Illinois, Maryland, Virginia, and Colorado. The national conversation about preferential treatment for donors’ children and alumni relatives is accelerating.
If you were banking on legacy status at a school to give your student a meaningful edge, the legal and legislative tide is running against that assumption. More importantly: the courts are watching, and schools are under pressure to demonstrate that their processes are defensible. The best admissions strategy has always been the one that doesn’t depend on who your parents know — build the application that makes the case on its own merits.
What to Do This Week
- ✓ Recalculate your loan picture. If Parent PLUS loans are in your plan, model the new caps against all four years of costs at every school on your list before July 1 passes.
- ✓ Get your student registered to test. The next ACT and SAT administrations are coming up. If your junior doesn’t have a test date, that’s the first call to make Monday morning.
- ✓ Review your college list for financial aid exposure. If every school on the list is subject to the endowment tax, add some strong schools at different price points now — not after decisions come in.
- ✓ Seniors: review your ED agreement. If you committed Early Decision and your financial aid package changed due to new federal rules, speak with the financial aid office directly about your options.
Not sure how these changes affect your family?
Let’s talk through it. I work with students and families across South Carolina and beyond — and this is exactly the kind of week where a single conversation can save a lot of stress.
Schedule a Free Consultation— Chris Parsons, College Planning Center
Christopher Parsons is the founder of the College Planning Center and the author of Entering the Arena: Turning the College Admissions Odds in Your Favor. With 25 years in education — including time at The Citadel, the University of South Carolina, and years in the high school classroom — he helps students and families navigate the college admissions process on their own terms.
Carpe diem.
