Federal Loan Schedule of Reduction

Planned Part-time Enrollment

In this example let’s consider the eligibility for an undergraduate senior planning to take 8 credits per semester. As a senior, their full-time Federal Direct Loan Eligibility is $7,500.

If they were to enroll in 8 credits per semester, their annual enrollment would be 16 credits.

Based of the SOR calculation, their reduced annual loan limit percentage would be:

(16/24) x 100 = 67%

Based on the SOR calculation, their less than full-time loan eligibility would be:

$7,500 x 67% = $5,025

This means they would be eligible for $2,512 per semester at 8 cr enrollment. (Full-Time eligibility would be $3,750/semester)

This example also applies for graduate students if they were instead to use the graduate loan limit and full-time credit requirement for their program.

Unplanned Part-time Enrollment

In this example we will consider the same undergraduate senior, but instead of planning to enroll part-time, they instead enrolled full-time at 12 credits per semester. In this case, they would start the year with their full-time eligibility for Federal Direct Loans of $7,500.

After the semester starts, however, they unexpectedly had to drop one of their fall courses after their fall loans had disbursed. This unexpected change in enrollment would result in less than full-time enrollment as a W grade does not count towards full-time enrollment under then new H.R. 1. rules.

This change in enrollment would result in a reduction to the loans they can receive in the spring based on the SOR calculation:

New Academic Year Enrollment – 20 credits

(20/24) x 100 = 83%

Less than Full-Time Loan Eligibility

$7,500 x 83% = $6225

How this impacts Spring Loan Eligibility:

Since this student already had a full-time loan amount disbursed for the fall ($3,750), the full time amount must now be subtracted from the new less than full-time annual eligibility.

$6,225 – $3,750 = $2,475

This means that the student in this example would only be eligible for $2,475 in Federal Direct Loans in the spring, due to the change in Fall enrollment to less than full-time. Students should be very careful when making enrollment changes, as a SOR reduction after a loan has disbursed can result in a student receiving substantially less than they were anticipating in subsequent semesters.

Planned Part-time Enrollment for a Graduate Student

In this example, let’s consider the eligibility for a graduate student planning to take 8 credits per semester.

If they enrolled in 8 credits per semester, their annual enrollment would be 16 credits.

12 credits per semester is considered full-time enrollment for most school/colleges. So, their reduced annual loan limit percentage would be:

(16/24) x 100 = 67%

The annual Direct Unsubsidized LoanAn Unsubsidized Federal Direct Student Loan is made to a borrower meeting specific eligibility requirements, but not based on financial need (FAFSA). The borrower is responsible for paying all interest that accrues throughout the life of an unsubsidized loan. During in-school status, deferment, and forbearance periods, the borrower may choose to pay the interest charged on the loan or allow the interest to be capitalized. eligibility is $20,500 for most full-time graduate students. Based on the SOR calculation, their less than full-time loan eligibility would be:

$20,500 x 67% = $13,735

They would be eligible for ~$6,867 per semester at 8 cr enrollment.

If you have any questions, you can reach out to your school/college’s Graduate Financial Aid Office.

Students must meet both the per term credit requirement and the per academic year requirement to be considered full-time for Direct Loan Eligibility

• Undergraduate Students:
  • Full-Time Academic Year Credit Requirement: 24 Credits (12 Credits per term)
  • At-least Half-Time per Term Credit Requirement: At-least 6 Academic Credits
• Graduate/Professional/Doctoral
  • Full-Time Academic Year Credit Requirement: 24 Credits (12 Credits per term) – Unless otherwise explicitly stated by your school
  • At-least Half-Time per Term Credit Requirement: At-least 6 Academic Credits

W grades do not count towards full-time academic year enrollment and may result in a SOR calculation and adjustment to Direct Loan Eligibility for subsequent semesters.

Parent Plus loans are not reduced based on part-time enrollment. The Schedule of Reduction calculation only applies to Federal student borrowing, not parent borrowing.

Student enrolled less than full-time, however, may have a lower cost of attendance which could impact Parent Plus Loan eligibility.

SOR adjustments are based on the academic year credit minimum rather than per term. If you complete the full-time academic year credit requirement for your specific program then you are considered full-time for Federal Direct Loan Eligibility. If you complete less than the academic year credit requirement then your loans are subject to being reduced based on the SOR.

For example, lets look at an undergraduate student with an academic year full-time enrollment requirement of 24 credits.

Here are a few scenarios:

Scenario #1 – Typical Enrollment

Fall Enrollment – 16 credits

Spring Enrollment – 16 credits

Academic Year Enrollment – 32 Credits (Full-time)

Scenario #2 – Student drops to 8 credits in Fall, 16 Credits in Spring

Fall Enrollment – 8 credits

Spring Enrollment – 16 Credits

Academic Year Enrollment – 24 Credits

Despite dropping to 8 credits in the fall, this student would still be eligible for Full-Time Federal Direct Loans because they were enrolled in at least 6 credits in the Fall and still completed 24 credits for the year, despite being less than full-time in the Fall. This student would not be subject to a SOR adjustment.

Scenario #3 – Student drops to 8 credits in Fall and Spring

Fall Enrollment – 8 Credits

Spring Enrollment – 8 Credits

Academic Year Enrollment – 16 Credits

In this scenario, the student would be considered less than full-time for the academic year and would be subject to a SOR adjustment:

(16/24) x 100 = 50%

New Undergrad Senior Academic Year Loan Eligibility – $3,750

Students registered for 4 credits in a single semester will not be eligible to receive an Federal Direct Loans during that semester because they do not meet the At least Half-Time enrollment requirement to borrow Federal Direct Loans.

If you change your enrollment to less than full-time prior to an academic year loan disbursing, but will adjust your loan according to the SOR and split you less than full-time annual eligibility between the fall and spring evenly.

For example, prior to the fall semester you reduce your enrollment to 8 credits. BU Financial Assistance assumes that a student will enroll for the same number of credits in the spring as they do in the fall unless otherwise notified by the student. BU would calculate your academic year enrollment based on 16 credits total and award your federal direct loan eligibility based on a 50% SOR. Since your loans have not yet disbursed, this total annual eligibility would be split evenly between the fall and the spring.

If a student increased their enrollment for the spring, the student must notify BU Financial Assistance in order to have a federal direct loan increase based on the new enrollment.

Yes, the SOR rules apply to all Federal Loans for student borrowers including students with legacy eligibility for Graduate Plus Loans.

Here are examples of annual eligibility for a SPH student taking 8 credits in 2026-27 based on SPH Scholarship Percentage:

35% SPH Scholarship

40% SPH Scholarship

50% SPH Scholarship

If you require additional loan funding, you can investigate private credit-based loans. Credible is a great tool to quickly compare private loan options. Credible utilizes a soft credit check which will not impact your credit but allow you to view pre-approved interest ratesA loan expense charged a borrower for the use of borrowed money. Interest is calculated as a percentage of the principal of the loan, which includes the original amount borrowed and any capitalized interest., borrowing limits, and repayment options available to you.