Frequently Asked Questions
The twelve questions we get most, answered in brief — each links to the full field-manual page.
What is RAP?
The Repayment Assistance Plan — the new federal income-driven repayment plan created by the July 2025 law (P.L. 119-21) and live since July 1, 2026. Payments run 1%–10% of your total AGI by income bracket, minus $50 per dependent, with a $10 monthly minimum. On-time payments trigger an unpaid-interest waiver and up to a $50/month principal match, and remaining balances are forgiven after 360 qualifying payments (30 years).
Is the SAVE plan really gone?
Yes. SAVE was ruled unlawful and terminated by court order on March 10, 2026. Its roughly 7.5 million enrollees are receiving notices between July 1 and August 15, 2026, each opening a 90-day window to choose RAP, IBR, or the Tiered Standard plan before being moved automatically.
How do I apply for RAP?
Through the IDR Plan Request on StudentAid.gov — select RAP, consent to IRS data retrieval, and the application takes about 10 minutes. There is no paper form at launch, and applying is always free.
How much will my RAP payment be?
Your AGI bracket percentage (1%–10%) times your AGI, divided by 12, minus $50 per dependent, never below $10. A single $45,000 earner pays $150/month; a $60,000 earner pays $250; over $100,000 it is a flat 10% of AGI.
Does RAP count toward PSLF?
Yes — RAP is a qualifying plan for Public Service Loan Forgiveness, and PSLF forgiveness remains tax-free. The new Tiered Standard plan does NOT qualify for PSLF.
Is RAP forgiveness taxable?
Under current law, yes. The tax exclusion for forgiven student debt expired December 31, 2025, so RAP’s 30-year forgiveness (and IBR’s 20/25-year forgiveness) is federally taxable income in the year of discharge. PSLF stays tax-free.
Are Parent PLUS loans eligible for RAP?
No. Parent PLUS loans and any consolidation containing one are excluded from RAP. A closing window lets pre-July-2026 Parent PLUS borrowers reach IBR through consolidation — that window ends July 1, 2028.
What is the July 1, 2028 deadline?
The date the phased-out plans (SAVE, PAYE, ICR) end entirely. Borrowers still on them must have chosen RAP, IBR, or Tiered Standard by then or be moved automatically. It is also when the Parent PLUS IBR-via-consolidation window closes.
Does my spouse’s income count under RAP?
Only if you file taxes jointly. File separately and RAP uses your own AGI and your own claimed dependents — often the single biggest payment lever for couples with uneven incomes, though separate filing carries real tax costs.
What happens if I do nothing?
SAVE borrowers who let their 90-day window lapse — and phased-out-plan borrowers who reach July 1, 2028 without choosing — are moved automatically, without regard to PSLF plans, filing strategy, or clock credit. Choosing is always better than being chosen for.
Can I still get a $0 payment?
Not on RAP — its floor is $10/month with no exceptions. IBR can still produce $0 payments for incomes below 150% of the poverty line, which is one reason low-income borrowers should compare both before choosing.
Should I refinance instead?
Only a narrow profile should: high stable income, strong credit, emergency fund, no PSLF or forgiveness path, and a payoff horizon under about 10 years. Refinancing federal loans is permanent and forfeits every federal protection, including RAP’s interest waiver.
What are the interest waiver and the $50 principal match?
RAP’s two sweeteners, both triggered by paying on time. If your monthly payment doesn’t cover that month’s interest, the uncovered interest is cancelled outright — never added to your balance. And if your payment doesn’t reduce principal by at least $50, the government tops it up so your balance falls at least $50 every on-time month. Together they guarantee a RAP balance never grows and always shrinks — the direct answer to the ballooning-balance problem that defined the old system.
How does RAP get my income — do I recertify every year?
No paperwork: enrolling in RAP requires authorizing the Department of Education to pull your AGI, filing status, and dependent count from the IRS, and your payment recalculates automatically from your most recent tax return. If your income drops mid-year — layoff, hours cut — you don’t wait for the next return: you can submit current documentation and request an off-cycle recalculation.
What are the new borrowing caps?
For loans on or after July 1, 2026: graduate students $20,500/year and $100,000 lifetime; professional students (MD, JD, etc.) $50,000/year and $200,000 lifetime; Parent PLUS $20,000/year and $65,000 per student; and a first-ever $257,500 lifetime ceiling across all federal student borrowing. Grad PLUS is eliminated for new borrowers, with a wind-down for students already mid-program.
I’m in default — does any of this apply to me?
Not until you exit default: defaulted loans can’t enroll in RAP or any repayment plan. The two exits are rehabilitation (nine income-based payments; removes the default line from your credit history; usable once) and consolidation (faster, but the default notation stays for seven years). Once out, the full plan menu — and the same deadlines — apply to you like everyone else.
Which servicers are handling the transition?
The same federal servicers you already know — MOHELA, Aidvantage, Nelnet, Edfinancial and peers — execute the plan placements, but you apply at StudentAid.gov, not through their sites. We keep a transition guide for each major servicer: what the notice looks like, the processing timeline, and the screenshots to take before anything changes.
Does the $10 minimum payment still count for forgiveness and PSLF?
Yes — in full. An on-time $10 floor payment is a qualifying payment toward RAP’s 30-year forgiveness and toward PSLF’s 120 payments, and it triggers the interest waiver and principal match for that month. Ten dollars a month keeping all four benefits alive is the best deal in the entire system — which is why autopay on the floor payment matters so much.
Is this site affiliated with the Department of Education?
No — Student Loan Reset is an independent publisher. We never ask for your FSA ID, SSN, or account credentials; applying for any plan is always free at StudentAid.gov; and when a link here pays us (some refinancing links do), we say so on the page. Anyone charging a fee to enroll you in RAP or promising special access is running a scam.
What actually happens during the 90-day window?
Your servicer’s notice names your terminated plan and your deadline. Inside the window you apply for RAP, IBR, or Tiered Standard at StudentAid.gov; placement typically posts within one or two billing cycles, and you keep paying the old amount until it does. Miss the deadline and you’re assigned a plan automatically — with no regard for your PSLF strategy, filing status, or forgiveness clock. The window is short, but everything inside it is reversible except letting it expire.
Can I switch out of RAP later if I choose it now?
Pre-July-2026 borrowers keep plan mobility: you can generally move between RAP, IBR, and Tiered Standard as your situation changes, subject to each plan’s eligibility rules. Two moves are one-way: refinancing to a private lender (permanently exits the federal system) and certain consolidations (which can reset forgiveness credit and forfeit grandfathered statuses). New borrowers from July 2026 have RAP as their only income-driven option, so their mobility is RAP ↔ Tiered Standard only.