If your first federal student loan is disbursed on or after July 1, 2026, the One Big Beautiful Bill Act limits you to two plans. Here is how they differ.
Your two choices
| Feature | RAP (income-driven) | New tiered Standard (fixed) |
|---|---|---|
| Payment | 1-10% of AGI, minus $50/dependent | Fixed amount over a balance-based term |
| Term | Up to 30 years, then forgiveness | 10-25 years (full payoff) |
| Counts toward PSLF | Yes | No |
| Unpaid interest | Waived | Accrues normally |
| Recertify income | Yes, yearly | No |
Source: U.S. Department of Education OBBBA fact sheet, as of June 2026.
The new Standard plan terms
The fixed plan’s length depends on your starting balance:
| Starting balance | Repayment term |
|---|---|
| Under $25,000 | 10 years |
| $25,000 - $49,999 | 15 years |
| $50,000 - $99,999 | 20 years |
| $100,000 and above | 25 years |
Minimum payment is $50/month (or the balance if smaller).
How to choose
- Want the lowest payment, lower income, or pursuing PSLF? RAP fits - it scales with income, waives unpaid interest, and is the only PSLF-eligible plan for new borrowers.
- Can afford the payment and want the least total interest / to be debt-free fastest? The tiered Standard plan is usually cheaper overall, but it does not count toward PSLF.
Estimate both with the comparison calculator, and read how RAP works and the new Standard plan.
General information, not financial or legal advice. Rules are still being implemented - verify with your servicer and studentaid.gov.