Federal student loan repayment rules are changing, and those changes could affect your monthly payments and eligibility for loan forgiveness programs.
One of the biggest changes takes effect on July 1, 2026, when a new Income-Driven Repayment (IDR) option called the Repayment Assistance Program (RAP) becomes available. RAP will replace current IDR plans for new federal student loans and newly consolidated loans. Borrowers considering consolidation should understand how the new rules may affect their repayment strategy.
For borrowers working toward loan forgiveness, the good news is that Public Service Loan Forgiveness (PSLF) and Teacher Loan Forgiveness (TLF) remain available. However, changes to repayment plans could impact eligibility requirements and repayment strategies, making it important to review your options carefully.
Borrowers with Parent PLUS loans should pay particular attention. If you are pursuing PSLF, you may need to take action before July 1, 2026. Existing Parent PLUS loans may need to be consolidated and enrolled in an eligible repayment plan, and taking out new loans could affect your current progress toward forgiveness.
Another significant change is the end of the SAVE (Saving on a Valuable Education) Plan. Borrowers currently in SAVE forbearance will need to transition to a new repayment plan. Beginning July 1, loan servicers are expected to send 90-day notices to affected borrowers. Those who do not select a new repayment option may be moved to the standard repayment plan, with SAVE-related forbearance expected to end on September 30, 2026. Borrowers pursuing PSLF should consider another income-driven repayment plan as soon as possible.
With so many changes on the horizon, now is a good time to review your student loan situation and understand how these updates could affect your financial goals.