Estimates of the Effects of Loan Limits for Master's Degree Programs: An Analysis Using Parameters Outlined in the College Cost Reduction Act

Abstract

Representative Virginia Foxx (R-NC) introduced the College Cost Reduction Act (CCRA) in the 118th Congress. The act introduced a set of proposed changes to federal higher education policy, including new annual and aggregate limits on federal lending. Some stakeholders have speculated that the Republican majority in the 119th Congress might advance elements of the CCRA. In this brief, the author estimates the impact of CCRA-like loan limits on master's degree programs. The author finds that the impacts of loan limits vary substantially by state and by the type of institution housing the master's program. Previous Urban Institute analysis suggests that around one in five master's degree borrowers would be constrained by CCRA limits on borrowing (Delisle 2024). The author expands upon this analysis by assessing where the effects of loan limits might fall more heavily on programs and students. Some programs will not have any students affected by the loan cap, and others might have a large share of students subject to loan limits. Although her findings are subject to some degree of uncertainty, given data constraints, two program-level datasets (i.e., the College Scorecard and a dataset developed by the US Department of Education's Office of the Chief Economist, or OCE) point to a disparate set of impacts across states and institution types. Students enrolled in master's degree programs in Washington, DC, Oregon, New Hampshire, and Arizona are most likely to be constrained by CCRA borrowing limits, while students in Delaware, Utah, Alaska, Wyoming, North Dakota, and Iowa are least likely to be affected. Further, the author estimates that master's programs housed within for-profit institutions, and those within historically Black colleges and universities, are more likely to have students who are constrained by borrowing limits.