Student Loans · 2026 Update
The Repayment Assistance Plan Is Changing Everything
Starting July 1, 2026, the RAP becomes the only income-driven repayment option for new federal student loan borrowers. Here’s what it means for you.
Launch Date
July 1, 2026
Quick Answer
What Is the Repayment Assistance Plan?
The Repayment Assistance Plan (RAP) is a new federal income-driven repayment plan created by the “One Big Beautiful Bill Act,” signed into law on July 4, 2025. It launches on July 1, 2026 and will replace the SAVE, PAYE, and ICR plans for most borrowers.
Unlike previous plans that calculated payments based on discretionary income, RAP uses your total Adjusted Gross Income (AGI). Payments range from 1% to 10% of your AGI depending on how much you earn, with a $10 minimum monthly payment.
Payment Range
1% – 10%
of your total AGI per year
Minimum Payment
$10 / mo
regardless of income level
Forgiveness After
30 Years
vs. 20–25 years under old plans
Launch Date
Jul 1, 2026
mandatory for new borrowers
For borrowers weighing whether RAP makes sense or if private refinancing through lenders like SoFi, Earnest, or the marketplace Credible could save more money long-term, our calculator lets you compare both paths side by side.
Key Dates
Critical Deadlines You Can’t Miss
!
Before July 1, 2026
Parent PLUS Loan Consolidation Deadline
If you have Parent PLUS loans, you must consolidate them into a Direct Consolidation Loan before this date to remain eligible for income-driven repayment plans.
1
July 1, 2026
RAP Launches — New Borrowers Only Get RAP or Standard
Anyone taking out a new federal student loan after this date can only choose between the Standard Repayment Plan or RAP. Existing borrowers can keep their current plan for now.
2
July 1, 2028
SAVE, PAYE, and ICR Are Eliminated
All remaining borrowers on SAVE, PAYE, and ICR will be automatically transitioned. Only IBR and RAP will remain as income-driven options.
3
After July 2028
Auto-Enrollment for Remaining Borrowers
Borrowers who haven’t chosen a plan will be automatically enrolled in IBR or RAP. Choose your plan proactively to avoid suboptimal auto-enrollment.
Frequently Asked Questions
Your RAP Questions, Answered
It depends on your income and loan balance. RAP generally means higher payments for most borrowers because it calculates payments on your total AGI rather than discretionary income. Under the old SAVE plan, income up to ~$35,000 was shielded from calculation — RAP has no such shield. Use our calculator to estimate your specific payment.
Not immediately. If you don’t take out any new loans after July 1, 2026, you can remain on your current plan until July 1, 2028. After that date, SAVE, PAYE, and ICR will be eliminated and you’ll be moved to either IBR or RAP. The SAVE plan is no longer accepting new enrollments as of early 2025.
RAP still offers loan forgiveness, but the timeline is longer — 30 years for all borrowers, regardless of loan type. Under older plans, undergraduate loans were forgiven after 20 years and graduate loans after 25 years. Public Service Loan Forgiveness (PSLF) still applies after 120 qualifying payments under RAP.
The minimum monthly payment under RAP is $10, regardless of your income level. This is a significant change from SAVE, which allowed $0 monthly payments for very low income borrowers. If your calculated RAP payment would be less than $10, you still owe $10 per month.
No. Parent PLUS loans are not eligible for the RAP. Parent PLUS loans taken out after July 1, 2026 will only be eligible for the Standard Repayment Plan — no income-driven options. If you currently have Parent PLUS loans, you must consolidate before July 1, 2026 to preserve access to IBR.
Yes — this is one of RAP’s best features. If your monthly RAP payment doesn’t cover all the interest that accrues, the unpaid interest is waived. This prevents your loan balance from growing over time, which was a major problem under older income-driven plans. Additionally, RAP guarantees up to $50 of each payment goes directly to principal.
RAP doesn’t launch until July 1, 2026, so you can’t enroll yet. Once available, whether to switch depends on your situation. For most current borrowers on IBR, staying on IBR through 2028 may be better. For those with high income relative to debt, RAP’s interest subsidy could be valuable. Use our RAP calculator to compare your options.
For some borrowers — especially those with stable high income, strong credit, and no plans to pursue PSLF — private refinancing can result in a lower total cost than RAP’s 30-year repayment timeline. Major lenders like SoFi (fixed APR from 4.24%), Earnest (from 3.71%), and comparison platforms like Credible — which lets you check rates from multiple lenders in under 2 minutes with no hard credit inquiry — make it easy to see your options. The critical trade-off: refinancing federal loans to private loans means permanently losing access to RAP, IBR, and PSLF forgiveness. Run the numbers with our calculator before deciding.
As of early 2026, private student loan refinancing rates for well-qualified borrowers start around 3.71%–4.29% fixed APR. Earnest currently offers rates starting at 3.71% fixed APR, SoFi from 4.24%, and ELFI from 4.29%. Marketplace platforms like Credible and Splash Financial let you compare personalized rates from multiple lenders simultaneously. Rates vary based on your credit score, income, loan balance, and repayment term. Always compare at least 3–4 lenders before refinancing.
Ready to See What RAP Means for Your Loans?
Use our free calculator to estimate your RAP payment and compare it against private refinancing rates from lenders like SoFi, Earnest, and Credible.