Student Loan Update: New Payments To Rise For Millions of Americans
Summary
A new student loan repayment plan called the Repayment Assistance Plan (RAP) will start in July 2026. This plan will replace the current Saving on a Valuable Education (SAVE) plan and is expected to result in higher monthly payments for many borrowers. The changes will impact millions of Americans with federal student loans.Key Facts
- The new Repayment Assistance Plan (RAP) will begin for loans issued on or after July 1, 2026.
- RAP will replace the existing SAVE plan and become the primary income-driven repayment option.
- Monthly payments under RAP are expected to be higher than those under SAVE.
- The RAP plan uses adjusted gross income to set payment amounts, with increases as income rises.
- Approximately 40 million Americans have federal student loans.
- More than 7 million borrowers currently on the SAVE plan will have to move to other plans.
- The new plan follows legislative direction in the One Big Beautiful Bill Act and a 2026 rulemaking notice.
- The Department of Education will provide guidance and transition information as the new plan is implemented.
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