Some OBBBA Rules in Effect Today; Recapping Education Coverage Exposure

Research evidence excerpt

Some OBBBA Rules in Effect Today; Recapping Education Coverage Exposure

July 1, 2026 | 07:44 ET~

Education

Some OBBBA Rules in Effect Today; Recapping Education

Education Coverage Exposure Jeffrey M. Silber Analyst

jeff.silber@bmo.com (917) 239-4910

Ryan Griffin, CFA VP Associate

Bottom Line: ryan.griffin@bmo.com (347) 274-1822

Effective today, certain One Big Beautiful Bill Act (OBBBA) rules impacting the higher Legal Entity: BMO Capital Markets Corp.

education sector go into effect following its passage this time last year. We provide a

recap of the rules below, which we have previously written about. We note these rules

apply to all institutions - not just for-profit ones. While there is the potential for some

volatility/pressure surrounding student loan caps for graduate and professional degrees

(effective today), we feel that the overall impact will be modest and feel comfortable

with our coverage's exposure. Nonetheless, rules such as these have created some

wariness from investors in stepping into the group.

Key Points

Student loan caps. Effective today, loans for graduate and professional degrees face

annual and lifetime Title IV (federal financial aid) loan caps. Most of the schools run or

partnered by our coverage focus on undergraduate programs, which are not impacted.

However, among our coverage, CVSA has the largest graduate and professional program

exposure given its Medical and Veterinary schools, though we believe students will

bridge the gap with private lending options such as Sallie Mae; in addition, the May

2026 start date was likely unaffected (next start date is September 2026). Other

companies with graduate/professional program exposure include LOPE, PXED and STRA,

though their relatively low tuition rates likely mean minimal impact.