Both, LTFT proration occurs when the student is taking less than a full-time load of credits in a term-based program. You then have the option to split the prorated amount evenly between terms or you can proportionately calculate each individual term.

Currently, Portico is splitting evenly between terms when the Funding Estimate is first created. However, if you make credit load changes within the term it will apply the proportionate calculation. We believe the current formulas allow schools the flexibility of taking either approach.

The formula for calculating the schedule of reductions is the same regardless of the number of required terms in the academic year.

Determine the total SOR by dividing the number of credits that the student is expected to take by the number of credits that are considered FT for the academic year and convert to the nearest whole percentage.

Multiply your sub or unsub maximum by that percentage and then disburse either equally across all 3 terms or proportionately over the 3 terms.

The student would not be eligible for the interim exception (legacy) borrowing limits. To qualify for the interim exception (legacy) for Direct Loans, the student must meet the conditions described in 34 CFR 685.203(b)(2)(iv)(B).

The change from undeclared to a specific program would be considered a program change because the CIP code is different.

OBBBA impacts all aspects of a school's Title IV Administration, however there are some key takeaways you should focus on based on your specific question.

• Rules around loan eligibility for Clock Hour Programs have not changed, so your decision on whether to expand to a 900 hour program will not be impacted by the loan proration changes.
  
  
• Students with a certain Student Aid Index value will no longer be eligible for Pell. This is a good time to assess your students to see where you think they will fall in the Pell eligibility scale.
  
  
• Depending on how you structure your LPN program, there could be a significant impact to student's loan eligibility. Will your LPN program be clock hour or term-based? If term-based, will it allow students to add and drop courses during the term? Those factors will weigh into the level of impact.
  
  
• There is an earnings calculation that you should review in detail. Earnings for graduates from your program will be compared to earnings from a high school graduate in the same line of work. There are still a lot of unanswered questions around this topic but you should familiarize yourself with the details.

Great chart by NASFAA outlining rules and effective dates: https://www.nasfaa.org/uploads/documents/OB3_GE_FVT_Comparison_Regulations.pdf

This is ambiguous since the basis of the earnings calculation are high school graduates. The careers from beauty schools require a license and those licenses require completion of certain hours of study, so not sure what income they would use for comparison. Majority of the income for these graduates are tips, which aren't typically reported.

AACS (American Association of Cosmetology Schools) is actively seeking clarifications and PBA (Professional Beauty) has filed lawsuit to try and stop the rule from going into effect.

Initially certificate programs were left out of OBBBA and so they are trying to get that portion of the law reinstated in the rule.

Portico Financial Aid brings together automation software, fully managed financial aid services, and compliance support, built for career schools.

You can run aid in-house using software, outsource it through managed services, or get help with specific projects like compliance reviews and interim staffing.

Portico supports nursing, allied health, beauty and wellness, and trade and technical schools.

Yes. The schedule of reduction applies to graduate and professional unsub as well as graduate PLUS if awarded as part of legacy borrowing. A student attending only 10 out of 12 FT credits per term would have an SOR percentage of 30/36=83.33=83%. 20,500 x 83%=$17,015 max for the academic year.

Portico doesn't have a preference, the school has that option. The FE will currently calculate proportional based on the credits entered for each term.

1. Equal disbursement means you want to take the SOR adjusted annual amount and split it evenly across terms in your academic year. For example, if a student has 2 terms, the approved amount listed on the funding estimate is equally divided across the 2 terms. Proportional disbursement means instead of an even split across the terms, each term's disbursement is directly tied to the student's enrollment intensity - that is the percentage of credits one is actively taking in a term. So, SOR determines the reduced annual maximum; equal vs. proportionate disbursement determines how that reduced maximum is spread across terms. Portico can support flexibility but institutions should document its policy and apply it consistently.

2. A Title IV-approved LOA should preserve a student's OB3 legacy status as long as the student returns to the same program at the same school. If the leave is not Title IV-approved, or if the student withdraws, transfers, or changes programs, that student may lose legacy protection and become subject to the new OB3 loan limits. Remember that the LOA cannot exceed 180 days in any 12 month period.

Legacy borrowing limits are lost when a student changes programs whether after graduation or ceasing attendance in the original program.

A student starting a new master's program after July 1, 2026 would have an aggregate loan limit of $100,000 in graduate loans or $157,500 overall which includes undergraduate and prior graduate borrowing.

Two great charts from NASFAA on PSLF - https://www.nasfaa.org/uploads/documents/OB3_Repayment_Plan_Flowchart.pdf  https://www.nasfaa.org/uploads/documents/OB3_Repayment_Plan_Chart.pdf 

A legacy/ grandfathered borrower is a student or parent borrower who is temporarily protected from certain OB3 loan limit changes because the student received a federal direct loan disbursed on or before June 30, 2026 and the student remains enrolled in the same program at the same school.

This temporary protection lasts the lesser of three academic years or until the remainder of your expected time to complete your degree, whichever is shorter.

Even prior to July 1st your institution should have all relevant academic and student finance policies updated. This allows you to seamlessly implement the new changes.

You do not want to be in a position of figuring it out as you are processing in the new award year.

You should ensure your Financial Aid system is capable of accepting all ISIRs, communicating with COD and calculating Aid accurately.

FSA has not completely illuminated the scenarios where a student knowingly attends less than half time in one or more of the required terms. We are awaiting clearer guidance.

What IS true is that a loan disbursement cannot be made in the term if at the time of disbursement it is determined that the student is attending less than half time in said term. It also appears to be true that those credits from the less than half time term CAN be shifted to a later term in the academic year if there is a subsequent term in the academic year. SOR % would thus be increased based on those less than half time credits over the course of the academic year.

Nonterm programs will be affected by the following policy changes: 1) Non-federal grants/scholarship covering full COA=no Pell 2) Parent PLUS annual and aggregate limits 3) Lifetime limits and 4) Institutionally determined annual limits (if applicable to your school). Non credit degrees would not be eligible for TIV so OB3 has no impact there.

Pell: OB3 creates a new Workforce Pell grant program (separate from what we know as regular Pell grant) for short-term workforce programs. Next, starting in 2026-2027, a student cannot receive Pell for an SAI of 14790 or more.

Also, students who receive non-federal grants or scholarships (state grants/ scholarships, institutional grants/ scholarships, Private/ outside scholarships, athletic scholarships similar to scholarship aid, and other non-federal grant/ scholarship assistance from states, institutions, or private sources) that cover their full (not Pell COA) cost of attendance are not eligible for Pell, even if they meet Pell requirements.

PLUS: Grad PLUS is eliminated for new borrowers for new periods of instruction beginning on or after July 1, 2026 unless the student qualifies for legacy/ grandfathered protection. Parent PLUS is not eliminated but OB3 adds new borrowing limits: Capped at $20000 per year and $65000 total per dependent student unless legacy/ grandfathered.

For Parent PLUS loans after July 1, 2026, those are limited to standard repayment and generally lose past friendlier repayment options

NSLDS should be accurate, however manual calculation can be performed it the totals appear to be not correct. If the individual loan record appears to be not accurate, I would then call NSLDS to inquire/resolve.

Still awaiting official regulation but currently it has been advised that mid academic year grade level increases will be treated as single term calculations based on the increased amount the student would be eligible for.

So a freshman student in F/SP would be eligible for $1750/$1750 sub. If in Spring they advance to sophomore level then they would be eligible for an additional $500 max sub in that term ($2250-$1750=$500).

If they are attending less than full time in spring, you would follow the less than full academic year SOR calculation of credits in term/FT credit definition in term = SOR% and then multiply the additional sub of 500 by the single term SOR% to determine the additional amount of sub the student could be awarded in Spring.

Therefore a student attending Spring taking 10 credits as a sophomore could receive 10/12=83%. $500x83%=$415 additional sub payment in Spring.

Timely enrollment updates and the loan adjustment queues being implemented similar to Pell Intensity.

Portico is tracking legacy by combining loan-level first disbursement date, program identity, enrollment continuity, LOA documentation, and a system flag that looks like a ribbon in the Enrollment Information section of the CORE system right under Actions.

If you hover over the ribbon, you will see a pop up note appear saying OB3 Grandfathered until said date which is the lesser of three academic years or the student's remaining time to credential based on the data entry provided.

Portico will do as much as the heavy lifting for our schools as we can. Final rules have now been published but there are still a lot of unanswered questions.

If we need to recalculate Aid, Portico will be able to run updates through our backend logic, this is something we have done in prior years when late changes are made. For example, we had the Pell award amount change on us previously and we had to do a mass update through the backend of our system.

With most other vendors, schools had to manually update their Pell awards that year. Our recommendation for student communication is to let them know now, as you are packaging let them know that the Department of Education has been making a lot of changes that may cause changes to their current packaging. This way you remove the shock factor if change becomes their reality.

https://www.nasfaa.org/uploads/documents/OB3_Repayment_Plan_Chart.pdf 

Satisfactory Academic Progress (SAP) 150% maximum timeframe rules operate independently of the One Big Beautiful Bill Act (OBBBA) loan legacy provisions.

Legacy rules allow you to keep previous borrowing limits, but federal aid still stops immediately if you fail to graduate within 150% of your program's credit hours.

This legacy exception is only valid for the lesser of three academic years or your expected time to complete your credential.

If you hit your 150% SAP limit during this window, the legacy allowance cannot override it; your federal aid will cease.

Here are the formulas for how to calculate institutional loan limits.

(This was our most popular resource from the live Q&A session!)

The FE will calculate the correct loan amounts, and making sure the enrollment status is updated. You can submit a revised FE as well

For graduate, nonprofessional students, OB3 eliminates Grad PLUS for new borrowers after July 1, 2026, caps annual unsubsidized borrowing at $20,500, caps graduate aggregate borrowing at $100,000, adds a $257,500 lifetime student loan cap, and prorates loans for less-than-full-time enrollment. Students who had a Direct Loan disbursed by June 30, 2026 and stay in the same program at the same school may keep prior rules temporarily under the legacy provision. When it comes to repayment, new loans made on or after July 1, 2026 are generally limited to the new standard repayment plan or RAP; older IDR plans begin sunsetting by 07/01/2028.

1) Total Outstanding Principal Balance (OPB) is the current total that the student has borrowed that is not yet repaid including undergraduate and graduate/professional sub unsub as well as Graduate PLUS. Interest owed is excluded. If a student repays part of a loan principal then the Total OPB would be reduced by that repayment. Total OPB should not be used to make aggregate limit determination as PLUS loans previously borrowed should not be factored into sub or unsub aggregate limits.

2) The Lifetime Maximum Loan Total is a new field that tracks how much a student has borrowed in all sub, unsub and graduate PLUS to date. Health professional amounts are not included in this total. The Lifetime figure would not change if a student had repaid part or even all of their previously borrowed funds.

3) Remaining borrowing eligibility for sub and unsub is determined by viewing the Aggregate Principal Balance and calculating the remaining eligibility up to aggregate totals. Lifetime maximum loan totals would also factor into remaining eligibility borrowing for sub, unsub and graduate PLUS. Proper process includes reviewing the Lifetime Maximum loan totals first and then the aggregate remaining totals.

SOR does not impact the R2T4 rules.

https://studentaid.gov/manage-loans/repayment/plans/income-driven 

Update your catalog/school policy and make sure to bring it up during consultations/counseling when applying for FA.

Email is also an effective tool, through whatever platform your institution uses (email marketing platform, CRM, SIS, etc.)

The CIP code is one of the factors that will determine legacy, since it will be the same it will fall under those rules.

SAP probation will not impact losing the PLUS loan.

We are not aware of any extension to date, in fact Portico is already originating aid under the OB3 guidelines.

The SOR/LTHT calculations are already implemented on the Funding estimates. Once you enter the amount of credits per term, the aid will calculate correctly.

The only relevant change is when other non-Title IV scholarships/grants exceed the COA; the student is no longer Pell eligible.

At this time, there are no known factors that will impact massage therapy schools.

The SAVE process to clear citizenship for eligibility status will not change.

For loans if awarded in 2025-2026, no loan proration but if awarded in 2026-2027, SOR will apply.

You will use the academic year definition and the actual terms they are requesting loans for.

Clock-hour schools are not impacted.

Portico Financial Aid brings together automation software, fully managed financial aid services, and compliance support, built for career schools.

You can run aid in-house using software, outsource it through managed services, or get help with specific projects like compliance reviews and interim staffing.

Portico supports nursing, allied health, beauty and wellness, trade and technical schools, and more.

Portico Financial Aid is designed primarily for Financial Aid teams—especially Directors of Financial Aid and Financial Aid Officers who manage day-to-day packaging, compliance, and student funding.

It also supports the broader school leadership and operations teams involved in financial aid oversight and student finance, including executives (CEO, CFO, COO), compliance and regulatory staff, operations leaders, and IT teams responsible for system integrations and data management.

Portico's Financial Aid CORE is ready for OBBBA, keeping your institution compliant and reducing the operational complexity your team would otherwise have to manage manually.

New OBBBA capabilities now in CORE:

• Accurate loan limit identification for affected students

• Grandfathering logic based on packaging & expected graduation dates

• Enrollment transition tracking (LOAs, withdrawals, transfers) & loan eligibility impact

• Continuous monitoring of enrollment changes: swaps, drops & status changes

• Automatic loan reassessment before disbursement when enrollment thresholds are crossed

• Grandfather end date tracking for legacy rules

• Institutional loan limit controls by program (SUB, UNSUB & PLUS)

• Pell eligibility updates based on external funding, scholarships & grants

• Graduate, doctoral & professional classifications tied to new loan limits, including psychology & theology distinctions

Yes. Portico's team of specialists acts as an extension of your own team, taking care of back-end details like document review, ISIR corrections, reconciliation, and much more. Whether you’re ramping up for enrollment season or need long-term support, Portico is here to reduce risk, accelerate processing, and keep your school compliant as you navigate the changes in the OBBBA legislation.

Yes. Portico integrates with Department of Education systems (COD, NSLDS, Clearinghouse) and most SIS/ERP platforms through flexible API or FTP connections. Our team works with schools and vendors to set up reliable, bi-directional data exchanges.

Portico Financial Aid Software is web-based with a short learning curve, and onboarding includes training resources, live Q&A, documentation, and a dedicated account manager.

Portico is compliant with federal requirements and regularly audited. Data is encrypted in transit and at rest, with MFA and role-based access controls.

A team member will learn your setup, bottlenecks, and goals, then provide a custom demo and best-fit recommendation with pricing for your use case.