Major Overhaul of Federal Student Loan Income-Driven Repayment Plans Takes Effect in 2026

Federal student loan borrowers are facing significant changes to income-driven repayment (IDR) plans in 2026 due to the 'One Big Beautiful Bill Act'. The SAVE plan has been eliminated by court order and statute, with the new Repayment Assistance Plan (RAP) launching on July 1, 2026, as its replacement. Additionally, the PAYE and ICR plans are set to sunset by July 1, 2028, requiring borrowers on these plans to switch to IBR or RAP. The IBR plan remains permanent and is now easier to access.