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What Borrowers Need to Know About Student Loan Repayment
Student loan repayment is changing. Understanding what is ahead can help borrowers make more confident decisions about their financial future. The One Big Beautiful Bill Act (OBBBA) simplified the current repayment system, but it also means borrowers will have fewer options to choose from beginning July 1, 2026. While this may reduce confusion, it also makes it more important to understand how repayment will work moving forward.
Under these changes, borrowers with new loans beginning after July 1, 2026 will choose between two main repayment options: a new Tiered Standard Repayment Plan and a new income-driven repayment (IDR) option called the Repayment Assistance Plan (RAP). This is a shift from the multiple income-driven plans that currently exist (i.e., SAVE, PAYE, ICR). For current borrowers, these changes will happen in phases. Standard, Graduated, and Extended Plans will remain available to existing borrowers. However, all other existing income-driven plans will phase out by July 1, 2028, and borrowers will need to take action to choose a new plan before this deadline or within 90 days of their servicer communicating they must select a new plan.
The Repayment Assistance Plan
RAP will become the primary IDR plan, which bases borrowers’ monthly payment on their adjusted gross income (AGI) and waives unpaid monthly interest. Even if borrowers’ income is low, they will still make a small payment. Under this plan, borrowers receive forgiveness after 360 qualifying monthly payments. RAP will also be the primary Public Service Loan Forgiveness (PSLF)-eligible repayment plan starting July 1, 2026.
The Tiered Standard Repayment Plan
The new Tiered Standard Repayment Plan will shift repayment length depending on how much you borrow rather than a fixed 10-year timeline for all borrowers. While this can lower monthly payments, it may also mean paying more interest over time.
Although the new system is more streamlined, it places greater responsibility on borrowers to understand which options apply to them and how to plan their financial strategy accordingly. Because implementation details are still evolving and guidance may continue to change, it is especially important for borrowers to have a clear understanding of their own repayment circumstances. This includes considering when they last borrowed, whether they plan to borrow again, and which repayment plan best aligns with their financial goals, particularly for those pursuing PSLF.
At AccessLex Institute®, we remain committed to helping you make more informed decisions when financing your legal education and beyond. For more information on how these changes may impact students and borrowers, view our new infographic Changes to Student Loan Repayment Plans Due to OBBBA.