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Last verified Oct 17, 2026 against the official sources listed below

Borrowed on or after July 1, 2026? You have two plans, for all your loans

The rule

The 2025 law says that for a borrower with a Direct Loan made on or after July 1, 2026, the Department offers two plans: a Tiered Standard plan and the Repayment Assistance Plan. It applies to the borrower’s loans, including loans made before that date. StudentAid.gov puts it this way: if you have a single loan, including a Direct Consolidation Loan, first disbursed on or after July 1, 2026, you have access only to RAP and the Tiered Standard Plan for all of your Direct Loans.

What that closes off

  • IBR, PAYE and ICR are not available for any of your Direct Loans.
  • The old 10-year Standard, Graduated and Extended plans are not available.
  • A new Direct Consolidation Loan counts as a new loan for this rule.

What you get

  • Tiered Standard: fixed payments over 10, 15, 20 or 25 years depending on your balance. See Tiered Standard explained.
  • RAP: payments based on income and dependents, forgiveness after 30 years. See what RAP is.
  • You can switch between the two at any time.
  • If you don’t pick, you are placed in Tiered Standard.

Parent PLUS borrowers

A parent PLUS loan made on or after July 1, 2026 must be repaid under Tiered Standard. See the parent PLUS guide.

Before you take out a new loan

If you already have loans on IBR, borrowing again after July 1, 2026 moves all your Direct Loans into this two-plan system. The calculator can show both sets of options: choose the loan-timing answer that fits each case.

What to do next

  1. Check your loan types and first-disbursement dates on your StudentAid.gov dashboard.
  2. If you don’t choose, you are placed in Tiered Standard; choose RAP if you want an income-based payment.
  3. Before borrowing again, know that a new loan closes IBR for your older loans too.

Compare RAP, IBR and Standard with your numbers

Not financial or legal advice. This page explains the published rules. It does not tell you which plan to choose. Your loan servicer and StudentAid.gov have the final word on your account.

Official sources

  1. Public Law 119-21 (H.R. 1, signed July 4, 2025), Title VIII, Secs. 81001–82004
  2. 34 CFR 685.208, fixed payment plans including Tiered Standard (current eCFR)
  3. 34 CFR 685.209, income-driven repayment plans (current eCFR, as amended May 1, 2026)
  4. StudentAid.gov: One Big Beautiful Bill Act – Important Definitions (updated Aug. 24, 2026)

Last verified Oct 17, 2026. Corrections are logged on What changed.

Next guide: The Tiered Standard Plan explained