Trending Now - Borrowers Face Changes as New Student Loan Repayment Plans Arrive

WHO:

Fast Company - Approximately 7 million loan holders are enrolled in the Saving for a Valuable Education (SAVE) program.

Forbes - Secretary of Education Linda McMahon was present at a hearing on April 28, 2026.

WHAT:

Fast Company - Starting July 1, borrowers will need to choose a new repayment plan due to changes from the Big Beautiful Bill Act passed in July 2025.

Fast Company - Borrowers will have to choose between two options: a Repayment Assistance Plan (RAP) and a Tiered Standard Plan.

Forbes - The Education Department is launching two new tiered repayment plan options for federal student loans on July 1.

Forbes - The Tiered Standard repayment plan will have varying repayment terms of between 10 and 25 years based on the borrower's total balance.

Forbes - For federal student loan balances less than $25,000, borrowers will have a 10-year repayment term; for balances between $25,000 and $49,999, a 15-year term; for balances between $50,000 and $99,999, a 20-year term; and for balances of $100,000 or more, a 25-year term.

Forbes - The Repayment Assistance Plan (RAP) will require 1% of adjusted gross income (AGI) for borrowers earning $10,000 or less, increasing by 1% for each additional $10,000 in AGI, maxing out at 10% for borrowers with an AGI of $100,000 or more.

Forbes - Payments under RAP will count toward student loan forgiveness under the Public Service Loan Forgiveness (PSLF) program after 30 years of payments.

WHERE:

Forbes - The announcement and details regarding the new repayment plans are relevant to federal student loan borrowers in the United States.

WHEN:

Fast Company - The new repayment plans will take effect on July 1.

Fast Company - The Big Beautiful Bill Act was passed in July 2025.

Fast Company - Borrowers enrolled in SAVE will receive notices from federal loan servicers starting July 1.

WHY:

Fast Company - The changes in repayment plans are a result of the Big Beautiful Bill Act aimed at restructuring student loan repayment options.

HOW:

Fast Company - The Repayment Assistance Plan (RAP) will calculate monthly payments based on a percentage of the borrower's income, with payments recalculated annually.

Forbes - The Tiered Standard repayment plan will fix a borrower’s debt into payments spread across different time frames based on their loan balance.

(UPDATED May 30, 2026 13:20 UTC)

Approximately 7 million loan holders are currently enrolled in the Saving for a Valuable Education program, and starting July 1, they will need to select a new repayment plan due to changes from the Big Beautiful Bill Act. Borrowers will have two options: the Repayment Assistance Plan, which bases payments on income, and the Tiered Standard Plan, which offers varying repayment terms from 10 to 25 years depending on the loan balance. Under the Repayment Assistance Plan, payments will count toward student loan forgiveness after 30 years, providing a significant benefit for those in public service.