How Much Will You Pay Under RAP?

This is the question almost everyone leads with — and the way it’s usually phrased is wrong. People ask, What’s the RAP payment on a $70,000 loan? RAP doesn’t work that way. It ignores your loan balance entirely. Whether you owe $20,000 or $200,000, your monthly payment is the same: a percentage of your AGI, divided by 12, minus $50 per dependent. So the real question is “What’s my RAP payment at my income?”

RAP uses a sliding scale that climbs one percentage point for roughly every $10,000 of income, topping out at 10% above $100,000. Here is how that maps out for a single borrower with no dependents:

Worked examples make it concrete. A single borrower with no dependents earning $30,000 pays about $50/month (2% of AGI). At $50,000, it’s roughly $167/month (4%). At $70,000, about $350/month (6%). At $100,000, near $750/month (9%) — and just above that line, 10% kicks in, pushing a $120,000 earner to about $1,000/month.

Two warnings. First, the percentages apply to your whole AGI, so crossing a bracket line causes a small jump — a borrower at $100,001 pays meaningfully more than one at $99,999. Second, because RAP has no cap, high earners can end up paying more than they would on a standard plan. If you earn well above six figures, run the numbers against IBR before you commit.

Quick Answers to the Top Questions

When does RAP start?

July 1, 2026. From that date, RAP is the only income-driven plan for anyone taking out a new federal loan, alongside a new Tiered Standard Plan. Existing borrowers can opt into RAP too. See the switch-deadline section for timing.

Do I have to switch from SAVE?

Yes. SAVE has ended and its forbearance is winding down. Your servicer will send a notice starting around July 1, 2026, giving you about 90 days to pick a new plan. Do nothing and you’re moved to a Standard plan — usually a higher payment.

Is RAP or IBR better?

It depends on your income and goals. IBR often produces a lower payment (and sometimes $0) for lower earners and reaches forgiveness faster. RAP adds a strong interest subsidy. Compare them in the RAP vs IBR table below.

Does RAP count toward PSLF and forgiveness?

Yes. RAP payments count toward Public Service Loan Forgiveness (PSLF) at 120 payments, and any remaining balance is forgiven after 360 payments (30 years). Months spent in SAVE forbearance, however, count toward neither.

What if I do nothing?

You lose the choice. After your 90-day window closes, your servicer auto-enrolls you in the Standard or Tiered Standard plan, which charges fixed payments based on your balance — typically more than an income-driven plan, with no forgiveness clock.

What Is the RAP Plan? (and Why SAVE Ended)

The Repayment Assistance Plan is a new income-driven repayment (IDR) plan created by the 2025 budget reconciliation law — the One Big Beautiful Bill Act (OBBBA), which the U.S. Department of Education administers under the banner of the Working Families Tax Cuts Act. Like other IDR plans, it ties your monthly payment to your income and dependents rather than to your balance. Unlike them, it uses your total AGI instead of “discretionary” income, runs on a fixed bracket structure, and carries a 30-year maximum term.

RAP doesn’t arrive alone. It replaces the patchwork of older plans. For anyone borrowing on or after July 1, 2026, the only two choices are RAP and the new Tiered Standard Plan. Older income-driven options — SAVE, PAYE, and ICR — are being phased out entirely by July 2028, while IBR survives as the main legacy alternative.

So why did SAVE collapse? SAVE was the Biden administration’s IDR plan, built to deliver very low (sometimes $0) payments by shielding a large slice of income. It spent most of its life tangled in litigation, and in March 2026 the courts brought that to a close, treating the plan as unlawful. The Department stopped enrolling borrowers, froze the program, and began moving people off it. The crucial detail for anyone parked in SAVE forbearance: that time has not been counting toward forgiveness, and interest has been accruing.

One feature did survive the transition. RAP carries over SAVE’s signature interest benefit — if your payment doesn’t cover the interest that accrues, the unpaid interest is waived rather than piled onto your balance. For a fuller picture of where RAP fits among cancellation options, see our guide to student loan forgiveness programs in 2026. The official statutory comparison lives in the Congressional Research Service brief on RAP.

RAP vs IBR: Which Should You Choose?

For most borrowers leaving SAVE, the real decision is RAP versus IBR. They calculate payments differently, forgive on different timelines, and suit different people. Here’s the side-by-side, with Tiered Standard included so you can see what happens if you let the deadline pass.

The plain guidance: IBR frequently wins for lower-income borrowers and anyone pursuing PSLF. Because IBR is built on discretionary income, it carves out a poverty-line cushion before charging you a percentage, which can mean a smaller payment — or $0 — where RAP’s flat-AGI math would still charge you something. IBR also reaches forgiveness in 20 or 25 years, versus RAP’s 30. For PSLF chasers, lower IBR payments leave a larger balance to forgive tax-free at the 10-year mark.

RAP earns its keep elsewhere. Its interest waiver and $50 principal match mean your balance won’t balloon while you pay, which matters most if your payment wouldn’t otherwise cover the interest. Some moderate and higher earners — and anyone who simply wants the simplest, most predictable structure — may prefer it.

Married borrowers, read this twice. Your filing status changes the AGI these plans use. File jointly and your spouse’s income is folded into the AGI that drives your RAP payment (and into discretionary income for IBR). File separately and you generally exclude your spouse’s income — lowering the payment — but you may give up valuable tax benefits in the process. Model both scenarios, and weigh the deductions you could lose by filing separately before you decide.

The 90-Day Switch Deadline (SAVE Borrowers)

This is the time-sensitive part, so be precise about how it works. Around July 1, 2026, loan servicers begin sending individualized notices to borrowers still in SAVE. From the date your notice is issued, you have about 90 days to choose a new plan. Notices roll out in waves — roughly every two weeks, with the longest-enrolled borrowers contacted first — so your personal deadline depends on when your wave goes out. For early waves, that points to a deadline near the end of September 2026.

Miss the window and the decision is made for you: your servicer auto-enrolls you in the Standard Repayment Plan (or a Tiered/Consolidation Standard plan), which sets fixed payments based on your balance. For borrowers who chose SAVE because their balance was high relative to income, those fixed payments can be a painful jump.

What to do, and by when:

• Don’t wait for the notice. You can switch now. Every month in SAVE forbearance is a month that counts toward nothing while interest accrues.
• Decide between RAP and IBR first using the tables above, then apply for whichever fits. If RAP suits you, you can move to a holding plan now and switch to RAP once it opens July 1.
• Apply early. Millions are transitioning at once; processing backlogs are expected. Submitting well before your 90-day cutoff protects you from being defaulted into Standard while your application sits in a queue.

The Department’s official guidance on the transition is published by the U.S. Department of Education, and you can confirm your specific dates and apply at StudentAid.gov.

Does RAP Forgive Loans & Count Toward PSLF?

Yes on both counts — with timelines worth keeping straight. Under RAP, any balance remaining after 360 qualifying on-time payments — 30 years — is forgiven. That’s longer than IBR’s 20 or 25 years, the trade-off for RAP’s lower payments and interest protection.

For public servants, the better clock is PSLF, and it’s unchanged: 120 qualifying payments (10 years) at an eligible employer, with RAP payments counting all the way. If you work in government or nonprofit work, PSLF will almost always beat waiting three decades for RAP’s term to run out.

Two cautions. First, the months you spent in SAVE forbearance do not count toward PSLF or IDR forgiveness — which is exactly why getting back onto a qualifying plan quickly matters. Second, the two kinds of forgiveness are taxed differently. PSLF forgiveness remains tax-free at the federal level. RAP’s 30-year forgiveness is IDR-type forgiveness, and as of 2026 that may be taxable — covered in the tax section below.

RAP’s Interest & Principal Benefits

RAP’s two standout features are the reason some borrowers will choose it even when the headline payment isn’t the lowest available.

Unpaid interest is waived. If your RAP payment doesn’t cover all the interest that accrues in a month, the government absorbs the shortfall rather than tacking it onto your balance. As long as you make full, on-time payments, your loan won’t grow — a direct carryover from SAVE and a real protection against the “negative amortization” that quietly inflated balances under older plans.

A $50 monthly principal match. If your payment doesn’t reduce your principal by at least $50 in a given month, RAP applies a subsidy so that your balance drops by $50 anyway. It’s modest, but over years it nudges you toward actually paying the loan down rather than treading water.

One honest caveat: a low monthly payment stretched over 30 years can still mean more total interest paid across the life of the loan than a shorter, higher-payment plan — even though your balance won’t balloon. RAP protects you from runaway interest; it doesn’t guarantee the cheapest payoff. If your goal is to be debt-free fast, pairing a higher-paying plan with extra income from a side hustle may serve you better than minimizing the monthly figure.

Will Your Forgiven Loans Be Taxed? (The “Tax Bomb”)

Here’s the change that catches people off guard. The temporary federal exemption that made student loan forgiveness tax-free — part of the American Rescue Plan Act — expired on December 31, 2025, and Congress did not extend it. Starting in 2026, balances forgiven through income-driven plans (including RAP’s 30-year forgiveness) may once again be treated as taxable income in the year they’re discharged.

That can be a five-figure surprise. A borrower with $40,000–$50,000 forgiven could owe several thousand dollars in additional federal tax, and some states may tax it too. The important exception: PSLF forgiveness remains tax-free, so public servants reaching the 10-year mark are not affected.

If you expect IDR or RAP forgiveness down the road, plan for the bill — many advisors suggest setting aside roughly 25–30% of the expected forgiveness amount over time. We go deeper in our dedicated breakdown of whether student loan forgiveness is taxable in 2026, and you can check the underlying rules with the IRS. Because the math depends on your income, filing status, and the year of forgiveness, consult a qualified tax professional before relying on any estimate.

Special Cases: Parent PLUS, Married & New Borrowers

Parent PLUS borrowers

Parent PLUS loans are not directly eligible for RAP or most income-driven plans. To preserve access to an income-driven option, Parent PLUS borrowers generally need to consolidate into a Direct Consolidation Loan before July 1, 2026, then enroll in IBR. Deadlines and mechanics here have shifted more than once, so confirm your exact situation with your servicer before acting — and don’t leave it to the last week, since consolidation takes time to process.

Married borrowers

As covered above, your filing status changes the AGI that drives your payment. Filing separately can lower a RAP or IBR payment by excluding your spouse’s income, but often raises your tax bill. There’s no universal right answer — only the one that nets out best for your household.

Borrowers taking loans after July 1, 2026

Anyone whose first loan disburses on or after July 1, 2026 has exactly two repayment options: RAP and the Tiered Standard Plan. There’s a trap worth flagging: taking any new federal loan after that date can pull all of your loans — even older ones — into RAP-only territory, costing you access to a legacy plan you were counting on. If you have existing loans on a plan you like, think hard before borrowing again.

What Should You Do Right Now?

Translate all of this into a short list of moves:

1. Log in to StudentAid.gov and confirm your current plan, your loan types, and whether you’re in SAVE forbearance.
2. Estimate your RAP payment from Table 1 using your AGI and dependents.
3. Compare it against IBR for your income — especially if you’re a lower earner or pursuing PSLF, where IBR often wins.
4. Decide before your 90-day deadline and apply early to beat the processing crunch.
5. Watch for your servicer’s notice and handle any Parent PLUS consolidation now, not later.

While you’re at it, a stronger overall financial footing makes any repayment plan easier to carry. If a default or late payment dinged you during the SAVE chaos, here’s how to fix your credit score fast, and if you don’t yet have a cushion, see how much emergency fund you really need.

Frequently Asked Questions

When does the RAP plan start?

RAP becomes available on July 1, 2026. From that date it is the only income-driven repayment plan for new federal borrowers, alongside the new Tiered Standard Plan, and existing borrowers can opt in as well.

How much will I pay on the RAP plan?

Between 1% and 10% of your AGI, divided by 12, minus $50 for each dependent, with a $10 minimum. Roughly: $30k income ≈ $50/month, $50k ≈ $167/month, $70k ≈ $350/month, $100k ≈ $750/month. Your loan balance does not change the figure.

Is RAP or IBR better?

IBR is usually better for lower incomes and PSLF, because it can produce a smaller (or $0) payment and forgives in 20–25 years. RAP offers a stronger interest subsidy and a simpler structure. Compare both against your own income before choosing.

Do I have to switch from SAVE?

Yes. SAVE has ended. Your servicer will send a notice starting around July 1, 2026, and you’ll have about 90 days to pick a new plan or be auto-enrolled in a Standard plan.

Does RAP count toward PSLF?

Yes. RAP payments count toward Public Service Loan Forgiveness, which still forgives after 120 qualifying payments (10 years) and remains tax-free.

Does RAP forgive student loans, and after how long?

Yes — any remaining balance is forgiven after 360 qualifying payments, or 30 years. That’s longer than IBR’s 20 or 25 years.

What happens if I don’t choose a plan?

After your 90-day window closes, your servicer automatically moves you to the Standard or Tiered Standard plan, which charges fixed payments based on your balance — typically higher than an income-driven payment, with no forgiveness clock.

Is the RAP plan a good idea?

It depends on your situation. RAP’s interest waiver and principal match are genuinely valuable, but its 30-year term and flat-AGI math can cost lower earners and PSLF candidates more than IBR. It’s the default for new borrowers; for others, it’s one option to weigh, not an automatic best choice.

What’s the difference between PAYE and RAP?

PAYE charges 10% of discretionary income and forgives after 20 years, but it’s being phased out by July 2028. RAP charges 1–10% of total AGI and forgives after 30 years. The headline differences are total income versus discretionary income, and a longer forgiveness timeline under RAP.

Will my forgiven loans be taxed?

Possibly. The federal exemption expired at the end of 2025, so IDR and RAP forgiveness may be taxable as income in 2026 and beyond. PSLF forgiveness stays tax-free. Set money aside and consult a tax professional.