A viral post claiming the Trump administration is banning students from getting federal loans for low-paying college majors has passed 20 million views on X.
That is not what the new rule does.
The Department of Education pushed back on the claim on September 28, calling it “fake news.” The department says the rule does not ban academic programs or tell students what they can study. Instead, it creates an earnings test that can eventually remove federal Direct Loan eligibility from college programs whose graduates consistently earn less than a comparison group.
The distinction matters, especially for immigrants trying to understand whether a degree program they are considering could still qualify for federal loans.
What the viral claim gets wrong
The original claim, based on a New Republic report, said Trump was “banning students majoring in degrees that don’t make enough money from taking out college loans.”
The Department of Education rejected that description.
In a September 28 post, the department said the federal government does not set college curricula or decide which programs schools can offer. It described the new policy instead as a way to hold colleges accountable when their programs leave graduates financially worse off.
That means there is no federal list of “bad” or low-paying majors that students are prohibited from choosing.
A student can still choose a particular field of study. The question is whether the program itself remains eligible for federal Direct Loans if it repeatedly fails the new earnings test.
Where the new rule comes from
The earnings test comes from the One Big Beautiful Bill Act, signed by President Trump on July 4, 2025. The Department of Education now refers to the legislation as the Working Families Tax Cuts Act.
The department proposed the relevant regulations in April 2026. The final regulations, covering the Student Tuition and Transparency System and Earnings Accountability framework, were published on July 1, 2026.
So this is not a proposal that is still waiting for Congress to act. The underlying law has already been enacted, and the final regulations have already been published.
The important question is when the earnings test starts producing consequences.
How the earnings test works
The rule does not ask whether a particular major “pays enough.”
It compares the earnings of graduates from a specific program with the earnings of a broader comparison group.
For undergraduate programs, the comparison is based on the median earnings of working adults ages 25 to 34 whose highest level of education is a high school diploma.
For graduate programs, graduates are compared with working adults ages 25 to 34 whose highest level of education is a bachelor’s degree.
The program does not immediately lose federal loan eligibility if its graduates fall below the benchmark once.
A program must fail the earnings test in two out of three consecutive award years before it can lose eligibility for federal Direct Loans.
And the consequence applies to the program, not to the student’s choice of major.
Nothing happens to programs immediately
This is one of the biggest differences between the viral claim and the actual rule.
For most programs, the earnings test begins on July 1, 2027.
Even after that point, a single year of low earnings is not enough to eliminate loan eligibility. The program must fail in two of three consecutive award years.
That means the first potential loss of federal loan eligibility would come only after the required testing period, rather than immediately when the rule takes effect.
So a student enrolling now is not suddenly being told that a particular major cannot be financed with federal loans.
The impact is expected to be uneven
The rule could still have a significant effect on some colleges and programs.
Analysis cited in reporting on the final rule, including analysis by the Los Angeles Times, projects a much larger effect at for-profit institutions than at nonprofit colleges and universities.
The estimates cited in coverage suggest that roughly one-third of programs at for-profit schools could be affected, compared with about 3% of programs at nonprofit institutions.
The same analysis estimates that around 4.2% of federal student loan borrowers could eventually need another way to finance their education.
Those projections are not the same thing as programs already losing eligibility. They are estimates of the potential scope of the rule once the earnings tests begin operating.
There is another student-loan change that matters for graduate students
The earnings test is not the only student-loan change created by the 2025 law.
The legislation also changes federal borrowing limits for graduate students, professional students and parents, while phasing out the Grad PLUS loan program.
Those changes take effect separately, beginning July 1, 2026.
That is important because a student can be affected by the new borrowing limits even if the academic program has nothing to do with the earnings test.
In other words, the viral discussion is mixing together several different student-loan changes.
What this means for F-1 students
For international students in the U.S., there is an important catch: F-1 students generally cannot receive federal student aid in the first place.
The Federal Student Aid Handbook says federal student aid eligibility generally requires U.S. citizenship or nationality, lawful permanent residence, or another qualifying noncitizen status, such as refugee or asylee status.
Nonimmigrant visa holders, including people in F-1, F-2 and M-1 status, are specifically excluded from federal student aid eligibility.
So the new earnings test generally does not change the federal loan options available to someone studying in the U.S. on an F-1 visa. The bigger issue is that F-1 students generally were not eligible for these federal loans before the new rule. See also: A Court Blocked the F-1 “End Date” Rule One Day Before It Took Effect. What Applies Now?.
For students who have recently obtained a green card, the situation is different. Lawful permanent residents can qualify for federal student aid if they meet the other eligibility requirements. See also: Who Among Non-Citizens Still Qualifies for Medicare After the 2026 Law?.
The separate changes to federal student loan interest rates for 2026-27 are also more immediately relevant to borrowers who are already eligible for federal loans.
What if a green card holder is choosing a major?
A lawful permanent resident who qualifies for federal student aid does not need to avoid a particular major because of this rule.
The practical issue is whether the specific program remains eligible for federal Direct Loans once the earnings test begins operating.
That makes the timing important.
The earnings test generally begins July 1, 2027. A program then has to fail in two of three consecutive award years before losing loan eligibility.
For someone choosing a program now, that is very different from a rule saying the federal government has already banned loans for a particular field of study.
The key dates and numbers
| Detail | What the rule says |
|---|---|
| Viral claim | Trump is banning loans for low-paying majors |
| Department of Education response | Called the claim “fake news” on Sept. 28, 2026 |
| Underlying law | One Big Beautiful Bill Act, signed July 4, 2025 |
| Final regulations | Published July 1, 2026 |
| Earnings test begins | July 1, 2027 for most programs |
| Failure required | 2 of 3 consecutive award years |
| Undergraduate comparison | Working adults ages 25 to 34 with a high school diploma |
| Graduate comparison | Working adults ages 25 to 34 with a bachelor’s degree |
| Projected for-profit impact | About one-third of programs |
| Projected nonprofit impact | About 3% of programs |
| Projected borrowers affected | About 4.2% |
| F-1/F-2/M-1 holders | Generally not eligible for federal student aid |
What students should actually watch
The new rule does not decide which subjects Americans or immigrants are allowed to study.
It creates a financial accountability test for college programs. A program whose graduates repeatedly fall below the relevant earnings benchmark can eventually lose access to federal Direct Loans.
That distinction is especially important for immigrants because federal student-loan eligibility already depends heavily on immigration status.
For an F-1 student, the immediate issue is generally federal-aid eligibility itself. For a green card holder, the new program-level earnings test could matter later, but it does not currently amount to a ban on choosing a particular major.
The other student-loan changes taking effect in 2026, including new borrowing limits and the phaseout of Grad PLUS, may have a more immediate effect on someone planning graduate or professional school.
The viral claim turns all of that into a much simpler story: low-paying major equals no federal loan.
That is not what the regulation says.
Sources: x.com, federalregister.gov, fsapartners.ed.gov, bizpacreview.com, fsapartners.ed.gov
