A major shift in federal student lending is about to reshape how thousands of Illinois families pay for college. Grad PLUS loans have been eliminated, Parent PLUS borrowing is now capped at $20,000 per year and $65,000 over a student’s lifetime, and new federal limits will make it harder for families to bridge the gap between aid and the full cost of a degree.

For many students, that gap is the difference between graduating and stopping just short of the finish line.

Every year, thousands of Illinois students work hard to get into college and even harder to stay there. They’ve proved themselves academically and found ways to pay for their first years. But a financing system built largely around family wealth still struggles to recognize their individual promise.

We have heard from Illinois families facing exactly this reality. One parent described a daughter who was one semester from graduation after exhausting scholarships, federal aid and family savings. She wasn’t asking for special treatment. She was asking for the chance to finish what she had already earned.

We come at this from different sides of the same problem. One of us has spent more than a decade in public office expanding college savings and access to higher education financing for working families across the state. The other built Funding U to serve students whom the traditional credit system overlooks, designing a private lending model based on academic performance and future earning potential rather than family wealth. Together, we have reached the same conclusion.

That is why we partnered through Illinois’ Student Empowerment Fund to launch the Illinois No-Cosigner Loan. The program was designed to help students who have exhausted grants, scholarships, work-study opportunities and federal loans, but still face a final funding gap that threatens their ability to complete their degree.

Borrowing should never be the first option. Students and families should first maximize grants, scholarships and federal aid. But when those resources fall short, too many capable students are shut out because traditional lending relies on family wealth, a co-signer or an established credit history rather than a student’s own record of achievement and future earning potential.

Credit scores were never meant to define human potential. Yet for too many students, a FICO score determines whether they get to finish school or walk away just short of a degree.

Students who demonstrate academic commitment and strong future earning potential should have access to responsible financing even if they lack family wealth or an established credit history. In other words, students should be evaluated on what they have accomplished and what they are capable of becoming. Responsible lending models can expand opportunity while maintaining strong underwriting standards.

The Illinois No-Cosigner Loan was launched in 2025 with a $7.5 million investment. One year later, the program has delivered more than $2 million in loans to nearly 200 Illinois students pursuing degrees in healthcare, education and high-demand fields such as science, technology, engineering and math. These are the nurses, teachers, engineers and skilled professionals Illinois employers urgently need.

As federal student loan policy changes, tuition bills will not disappear. Students will still enroll in college, institutions will still open their doors and employers will still depend on a trained workforce. The question is not whether demand for education will continue, but whether students without family wealth will still have a fair path to complete their degrees.

Illinois is showing there is another way forward. Through practical public-private partnerships such as the Student Empowerment Fund, the state is helping students complete their education, strengthening its workforce pipeline and offering a model other states can follow.

At a moment of significant change in higher education, that kind of innovation is not simply good policy. It is an investment in Illinois’ future.

Michael Frerichs is Illinois’ state treasurer. Jeannie Tarkenton is founder and CEO of Funding U.

Submit a letter, of no more than 400 words, to the editor here or email letters@chicagotribune.com.