The Repayment Assistance Plan, or RAP, is the new income-driven repayment (IDR) plan for federal student loans and was created by President Donald Trump’s One Big Beautiful Bill Act (OBBBA). As of July 1, 2026, RAP is now available to eligible student loan borrowers. For borrowers who take out student loans after July 1, 2026, RAP is the only available IDR plan.
RAP has its pros and cons. Some borrowers may face higher monthly payments and a longer path to forgiveness under RAP. On the other hand, the plan’s structure — which cancels unpaid interest and guarantees principal reduction — could prevent ballooning balances and lead to faster repayment when compared to some other IDR plans.
RAP at a glance:
Repayment term until forgiveness: 30 years.
Payment amounts: 1-10% of your annual adjusted gross income (AGI); percentage is based on earning level. Payment reduced by $50 for each dependent claimed on your tax return. The plan offers $10 flat payments for those earning $10,000 per year or less.
Interest subsidy: If the RAP payment amount is less than the monthly interest that accrues on the loan, the remaining unpaid interest is not charged.
Matching principal payment: If the RAP monthly payment doesn’t reduce the principal balance by at least $50, a subsidy is applied to ensure the principal balance is reduced by at least $50 each month.
Qualifications: Borrowers must have federal direct loans. Parent PLUS loans and consolidated loans that include a parent PLUS loan aren’t eligible.
» CALCULATOR: Compare payment estimates for RAP and legacy IDR plans
Repayment Assistance Plan: timeline and borrower options
Here’s an overview of the new RAP plan rollout, changes to expect for legacy IDR plans and what to consider when deciding if and when to switch to RAP.
Key points to be aware of:
- Before July 1, 2026: If you were on a legacy IDR plan — Income-Based Repayment (IBR), Pay As You Earn (PAYE) or Income Contingent Repayment (ICR) — prior to this date, you have the option to remain on it for now, but only if you don't take out new loans or consolidate loans. The Saving on a Valuable Education (SAVE) plan has ended. Borrowers on the SAVE plan are receiving notices from their loan servicers about transitioning to a different IDR plan.
- July 1, 2026. RAP is now available and borrowers can enroll. Borrowers who take out a new loan after this date will only have access to RAP or the new, tiered standard repayment plan.
- July 1, 2028. ICR and PAYE will end by this date. Borrowers who did not take out additional loans after July 1, 2026, can enroll in IBR until this date. Anyone still in ICR or PAYE when it ends will be automatically moved to RAP, or to IBR if they’re not eligible for RAP.
Action items based on RAP timeline
| Date | What happens | What you should do |
|---|---|---|
| July 1, 2026 | RAP is now available. New and existing borrowers can enroll in the plan. | Use the Department of Education (ED) loan simulator to compare RAP to your current plan. |
| Through June 30, 2028 | Transition period for legacy IDR plans. | Decide whether to stay in your legacy plan (if it remains available), move to RAP, or enroll in IBR if eligible. |
| July 1, 2028 | PAYE and ICR are retired. | If still enrolled in one of these plans, move to either RAP or IBR (if eligible) by this date. If you don’t choose, the ED will automatically choose a plan for you. |
How to estimate your monthly Repayment Assistance Plan bill
RAP monthly payments are graduated based on your AGI in the previous tax year. The more you earn, the larger the slice of your income you pay each month. RAP requires you to recertify income annually, so a pay increase that puts you in a new bracket will increase your student loan payment.
Find your RAP base payment
| Annual income bracket | RAP base payment |
|---|---|
| $0 - $10,000 | $120 ($10 monthly) |
| $10,001 - $20,000 | 1% of adjusted gross income (AGI) |
| $20,001 - $30,000 | 2% of AGI |
| $30,001 - $40,000 | 3% of AGI |
| $40,001 - $50,000 | 4% of AGI |
| $50,001 - $60,000 | 5% of AGI |
| $60,001 - $70,000 | 6% of AGI |
| $70,001 - $80,000 | 7% of AGI |
| $80,001 - $90,000 | 8% of AGI |
| $90,001 - $100,000 | 9% of AGI |
| $100,001 and above | 10% of AGI |
Once you have your annual base payment, use this formula to calculate your monthly RAP bill:
RAP monthly payment formula
(RAP base payment / 12) - $50 per dependent = Estimated monthly RAP payment
Public Service Loan Forgiveness and the Repayment Assistance Plan
For borrowers who take out federal student loans on or after July 1, 2026, repayment options are limited to RAP or the standard plan. Because the standard plan does not qualify for Public Service Loan Forgiveness (PSLF), eligible borrowers who want to work toward PSLF will need to enroll in RAP. PSLF forgives a borrower’s remaining loan balance after 120 monthly payments made while working full time for a qualifying government or nonprofit employer.
RAP vs. existing IDR plans
Like other IDR plans, RAP still ties payments to income, but it differs in several key ways:
- Uses AGI instead of discretionary income. RAP calculates payments as a percentage of adjusted gross income. Legacy IDR plans calculate payments using discretionary income, by subtracting 100% or 150% of the federal poverty guideline from a borrower’s income. (The SAVE plan was 225%.) Because poverty guidelines adjust annually for inflation, discretionary income — and IDR payments — change accordingly. RAP doesn’t adjust for inflation, meaning payments could increase and become difficult to manage over time.
- Different treatment of dependents. Legacy IDR plans adjust payments based on family size, which could include a spouse or other household members. RAP instead provides a flat, monthly reduction ($50) based on the number of dependents you claim on your federal tax return.
- No $0 payments. Unlike some legacy income-driven repayment plans, RAP doesn’t allow $0 monthly payments. The lowest payment you can have is $10, even if you lose your job or face a drop in income.
- Provides interest subsidy. Like the popular SAVE plan (which is now ending), RAP waives any unpaid interest not covered by a borrower’s monthly payment. IBR and PAYE offer interest subsidies, but only for subsidized loans for the first three years. ICR offers no interest subsidy.
- Matching principal payment amount. RAP guarantees that loan principal declines by at least $50 a month; if your payment doesn’t reduce the principal by that amount, a government subsidy makes up the difference. Other IDR plans don’t offer such a subsidy or require principal reduction, so the balance can stay flat or grow.
How RAP compares to other IDR plans
| Feature | RAP | IBR/PAYE/ICR |
|---|---|---|
| Repayment term / time to forgiveness | 30 years for all borrowers. | 20 or 25 years depending on plan and loan type. |
| Income used to calculate payment | Adjusted gross income (AGI). | Discretionary income. |
| Amount of income protected from payment calculation | None. | 100% to 150% of the federal poverty guideline protected (varies by plan). Also depends on your location and family size. |
| Payment amount range | 1%–10% of your AGI; $10 minimum payment. | 10%–20% of discretionary income; $0 payments possible. |
| Family size or dependent adjustment | $50 reduction per dependent claimed on federal tax return. | Payment adjusted based on total family size. |
| Interest accrual if payment doesn't cover interest | Unpaid interest is not added to the loan balance. | No interest subsidy for ICR. For PAYE and IBR, monthly unpaid interest waived for first three years on subsidized loans. |
| Guaranteed principal reduction | Yes, at least $50 per month. | None. |
| Note: We have not included the Saving on a Valuable Education (SAVE) plan in this comparison chart, because it has ended. Borrowers enrolled in SAVE have begun receiving notices about transitioning from SAVE. | ||
» MORE: How to get student loan help
What to know about enrolling in RAP
For some borrowers, RAP may provide a faster path to repayment. It prevents unpaid interest from growing the balance and guarantees that principal declines by at least $50 per month. RAP also qualifies for PSLF, provided other eligibility requirements are met.
But RAP may not be the best fit for everyone. It doesn’t shield a portion of income using a poverty-based formula and it has a standard 30-year forgiveness timeline. Depending on your income and family situation, monthly payments could be higher than under some legacy income-driven plans, and forgiveness may take longer.
As of July 1, 2026, you can enroll in RAP, but take time to determine if that’s your best choice. Consider how RAP will affect your projected monthly payment and timeline to forgiveness. Factors such as your current and expected future income, number of dependents, student debt amount and eligibility for programs like PSLF can all influence which repayment plan makes the most sense for you. RAP has now been added to the ED loan simulator, so you can run side-by-side comparisons of your repayment options.
