House settlement FAQ: Its impact on NIL, the transfer portal, roster limits, and more

A federal judge approved the settlement of the House v. NCAA class-action lawsuit on Friday, permanently changing the landscape of college athletics. In short, the settlement:

Here’s how the settlement will impact NCAA Division I schools moving forward, and some refreshers on the state of modern college athletics.

» READ MORE: Big changes coming in college sports after Federal judge approves settlement. Here’s what to know.

College athletes are able to receive third-party compensation generated by their personal brand, otherwise known as their name, image, and likeness (NIL).

After a unanimous Supreme Court ruling that decided the NCAA was in violation of antitrust laws, the top governing body for college athletics changed the rules that prohibited third-party payment to athletes.

Since July 1, 2021, athletes have been able to receive financial compensation through NIL endorsements.

Yes. As outlined in the House settlement, revenue sharing will allow schools to directly compensate athletes for the use of their name, image, and likeness. There is a cap on the funding schools will be able to distribute annually. The limit is estimated to be $20.5 million this season, although the figure is not official yet.

Athletes will still be eligible to receive NIL compensation from third parties on top of any compensation they may receive from their athletic departments.

The Ivy League said in January that the conference would not opt in to the revenue sharing agreement outlined in the House settlement. However, Ivy athletes will still be able to benefit from third-party NIL opportunities.

NIL opportunities from university-associated collectives must be paid “for a valid business purpose” at “fair market value rates,” according to Temple’s House settlement FAQ page. The House settlement establishes NIL Go, a clearinghouse overseen by Deloitte. Athletes will report their NIL deals worth at least $600 on the platform, and NIL Go will confirm that the deals are within the rules.

It varies by sport. Windows for fall sports typically open in late November or early December and close in late December or early January. For winter sports, portal periods usually begin in March and close anywhere from mid-April to mid-May. Spring sports windows typically open in early May and close by late May or June.

Yes. In April 2024, the NCAA adopted new transfer rules that permitted athletes to transfer between schools and be immediately eligible to play, regardless of how many times they had transferred.

Before that change, athletes were required to redshirt after their second transfer, as well as any potential following moves. The NCAA’s rules regarding transfers have relaxed since 2021, when it adopted the second-transfer redshirt rule. Before then, athletes who transferred were deemed ineligible for the following season and forced to redshirt.

» READ MORE: Villanova’s basketball team should benefit from the NIL settlement, but little else is immediately clear

The House settlement will impact college sports in three main ways. It establishes a direct revenue-sharing model between D-I schools and their athletes, allocates $2.8 billion in NIL back pay to be paid out to former and current college athletes, and creates roster limits for all teams.

Starting July 1, athletic departments will be able to compensate athletes directly from their revenues. The $20.5 million cap figure is an estimate of 22% of the average athletic revenue of a power-conference institution, and will act as a hard cap on direct spending for high-revenue athletic departments.

The NCAA and its schools will distribute NIL back pay to approximately 400,000 current and former athletes over the next 10 years. Of the $2.8 billion, 60% will be funded through reduced revenue distribution, while the NCAA will generate the remaining 40% on its own.

The settlement places firm roster limits on opted-in Division I teams for 2025-26 season. At the suggestion of the judge overseeing final approval, Claudia Wilken, the settlement has been revised to protect the spots of athletes currently on rosters, athletes who were cut this year, or high school athletes who were promised a spot, only to see it eliminated.

No. Schools in the ACC, Big Ten, Big XII and SEC are required to adhere to the terms of the settlement, and all in those conferences have indicated the intent to do so. The remaining Division I schools have until June 15 to decide whether to opt in or out of the settlement.

In the Big 5, Temple and Drexel have publicly stated the intent to opt in. Villanova, La Salle, and St. Joseph’s are all expected to do so as well. As a member of the Ivy League, Penn will opt out of the terms of the settlement. It will be unable to share revenue with its athletes.

» READ MORE: Temple opts into House v. NCAA settlement, setting the stage for revenue sharing on North Broad

There is a potential for more legal movement to further impact the landscape of college athletics. The House settlement does not address whether athletes can be classified as employees, an idea that has been examined by Johnson v. NCAA. The case, brought by former Villanova football player Trey Johnson, remains in litigation.

The NCAA and its president, Charlie Baker, have led an effort to lobby Congress in favor of a bill that would grant antitrust protection to the NCAA, based on the terms of the House settlement. Sen. Ted Cruz (R-Texas) has been pushing a bill that would introduce regulations to college sports since the Republicans took control of the House of Representatives and the Senate in January.

Regardless of further legal movement, the effects of the House settlement will change the way athletic departments, individual teams, and college sports operate.