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If you have federal student loans, you may have several options for paying them back. To choose the best federal student loan repayment plan, consider your loan type, financial situation and long-term goals. The right fit for a new graduate with a modest starting salary looks different from the right fit for someone chasing loan forgiveness through public service.
Your options also depend heavily on timing, since a major overhaul of federal repayment plans took effect July 1, 2026. Here's a quick look at what's available, followed by a closer breakdown of each option:
Student Loan Repayment Plans
| Eligibility | Payment Structure | Forgiveness Options | Best For | |
|---|---|---|---|---|
| Standard repayment plan | Loans disbursed before July 1, 2026 | 10 years; up to 30 years for consolidation loans | Teacher Loan Forgiveness; Payments count toward Public Service Loan Forgiveness (PSLF) | Legacy borrowers who want to pay off their debt fastest and with the least interest |
| Graduated repayment plan | Loans disbursed before July 1, 2026 | Payments start low and rise every two years over 10 years, up to 30 for consolidated loans | Teacher Loan Forgiveness | Legacy borrowers who expect steady income growth |
| Extended repayment plan | Loans disbursed before July 1, 2026, with an outstanding balance of $30,000 or more | Fixed or graduated payments over up to 25 years | Teacher Loan Forgiveness | Legacy borrowers with a large balance who want a lower payment without switching to an income-driven plan |
| Income-based repayment plan | Eligible loans disbursed before July 1, 2026 | 10% or 15% of discretionary income, capped at the standard plan amount | Remaining balance forgiven after 20 or 25 years; payments also count toward PSLF; Teacher Loan Forgiveness | Legacy borrowers who want an income-driven plan that isn't sunsetting |
| Income-contingent repayment plan | Eligible loans disbursed before July 1, 2026; phased out by July 1, 2028 | Lesser of 20% of discretionary income or a fixed 12-year payment adjusted for income | Remaining balance forgiven after 25 years; payments also count toward PSLF; Teacher Loan Forgiveness | Parent PLUS borrowers who consolidated their loans prior to July 1, 2026 |
| Pay as you earn repayment plan | Eligible loans disbursed before July 1, 2026, phased out by July 1, 2028 | 10% of discretionary income, capped at the standard plan amount | Remaining balance forgiven after 20 years; payments also count toward PSLF; Teacher Loan Forgiveness | Borrowers with high grad school debt relative to income |
| Repayment assistance plan | Any direct loan borrower except parent PLUS | 1% to 10% of adjusted gross income, minus $50 per dependent; $10 minimum | Remaining balance forgiven after 30 years; payments also count toward PSLF; Teacher Loan Forgiveness | New borrowers and legacy borrowers who want income-driven payments |
| Tiered standard plan | Loans disbursed on or after July 1, 2026; this is the only option for parent PLUS loans disbursed on or after July 1, 2026 | Fixed payments over 10, 15, 20 or 25 years based on balance | Teacher Loan Forgiveness | New borrowers who want predictable fixed payments |
What Is the Best Student Loan Repayment Plan?
There isn't one student loan repayment plan that works best for every borrower. For example, if you have a solid income and want to eliminate your debt as quickly as possible, you may stick to the standard or tiered standard plan. However, if you're pursuing PSLF, you might choose an income-driven repayment (IDR) plan with low payments that count toward that goal.
Timing matters just as much as your personal finances. A major overhaul of federal student loan repayment took effect July 1, 2026, and your options now depend on when your loans were first disbursed.
Borrowers whose federal loans were all disbursed before that date may keep access to a handful of legacy plans, though they can also switch into a new plan if it offers a better payment. Meanwhile, borrowers who take out any loan on or after July 1, 2026, whether it's a first loan or an addition to an existing balance, are limited to the two new plans.
Legacy Plans (for Loans Disbursed Before July 1, 2026)
If all your federal loans were disbursed before July 1, 2026, and you don't take out or consolidate any new loans, you may have access to up to six legacy plans. Here are your options, depending on your situation.
Standard Repayment Plan
The standard repayment plan sets a fixed monthly payment that pays off your balance within 10 years, or up to 30 years if you've consolidated your loans. It's the plan most legacy borrowers start on by default:
- Eligibility: Available to any borrower whose loans were all disbursed before July 1, 2026
- How payments work: Your payment stays the same for the life of the loan.
- Repayment term: 10 years for most borrowers, up to 30 years for consolidated loans, with a minimum payment of $50 a month
- Loan forgiveness: Teacher Loan Forgiveness; payments also count toward PSLF
- Best for: Borrowers who can afford higher monthly payments and want to pay the least interest over time
Graduated Repayment Plan
The graduated repayment plan starts with lower payments that increase every two years, on the assumption that your income will grow enough to keep up:
- Eligibility: Available to any borrower whose loans were all disbursed before July 1, 2026
- How payments work: Payments start low, then step up roughly every two years until the loan is paid off. Your payment will never be less than accrued interest, nor will it be greater than three times any other payment within the plan.
- Repayment term: 10 years for most borrowers, up to 30 years for consolidated loans
- Loan forgiveness: Teacher Loan Forgiveness; payments don't count toward PSLF
- Best for: Borrowers who expect steady income growth, such as early-career professionals in fields with predictable raises
Extended Repayment Plan
The extended repayment plan stretches your term out to as long as 25 years, with the option to keep payments fixed or graduate them over time:
- Eligibility: Available to borrowers with more than $30,000 in federal student loan debt whose loans were all disbursed before July 1, 2026
- How payments work: Choose a fixed payment that stays the same throughout the term, or a graduated payment that increases roughly every two years.
- Repayment term: Up to 25 years
- Loan forgiveness: Teacher Loan Forgiveness; payments don't count toward PSLF
- Best for: Borrowers with a large balance who want a lower payment than standard or graduated without switching to an income-driven plan
Income-Based Repayment (IBR) Plan
The IBR plan ties your monthly payment to your income and family size rather than your loan balance. It's the only legacy income-driven plan that isn't scheduled to end, though access may vary:
- Eligibility: Open to eligible borrowers whose loans were disbursed before July 1, 2026, regardless of income—the previous hardship requirement has been removed. The exception is parent PLUS loan borrowers, who need a direct consolidation loan funded before July 1, 2026, and one ICR payment before switching into IBR.
- How payments work: Your payment is set at 10% of discretionary income if you borrowed on or after July 1, 2014, or 15% if you borrowed earlier. It never exceeds what you'd pay under the standard plan.
- Repayment term: 20 years for newer borrowers, 25 years for those with older loans
- Loan forgiveness: Any remaining balance is forgiven at the end of the term, and payments count toward PSLF; also eligible for Teacher Loan Forgiveness
- Best for: Legacy borrowers who want a long-term income-driven option that will still exist after 2028
Income-Contingent Repayment (ICR) Plan
The ICR plan bases your payment on a larger share of your income than other income-driven plans, and it's set to disappear in a couple of years:
- Eligibility: Available to any borrower whose loans were all disbursed before July 1, 2026, though the plan is being phased out by July 1, 2028. It's also the only income-driven plan parent PLUS borrowers can use, but only if their direct consolidation loan was funded before July 1, 2026.
- How payments work: Your payment is set at the lesser of 20% of discretionary income or what you'd pay on a fixed 12-year plan adjusted for your income.
- Repayment term: 25 years
- Loan forgiveness: Any remaining balance is forgiven at the end of the term, and payments count toward PSLF; also eligible for Teacher Loan Forgiveness.
- Best for: Parent PLUS borrowers whose consolidation was funded before July 1, 2026, and who haven't yet made the one ICR payment required to switch into IBR.
Pay as You Earn (PAYE) Repayment Plan
The PAYE plan also sets your payment based on your income and family size, and it has a short forgiveness timeline compared to other IDR plans:
- Eligibility: Available to borrowers who took out their first federal loan on or after October 1, 2007, and a direct loan on or after October 1, 2011. All loans must be disbursed before July 1, 2026, and the plan is being phased out by July 1, 2028.
- How payments work: Your payment is set at 10% of discretionary income and never exceeds what you'd pay under the standard plan.
- Repayment term: 20 years
- Loan forgiveness: Any remaining balance is forgiven at the end of the term, and payments count toward Public Service Loan Forgiveness; also eligible for Teacher Loan Forgiveness.
- Best for: Borrowers with high graduate school debt who want the shortest legacy forgiveness timeline while the plan is still available
New Plans (for Loans Disbursed on or After July 1, 2026)
If you take out any federal student loans, whether as a new or an existing borrower, on or after July 1, 2026, you'll be limited to two repayment plans. Note that this also includes direct consolidation loans.
Additionally, both options are open to legacy borrowers who want to switch, even if their loans predate July 1, 2026.
Repayment Assistance Plan (RAP)
The RAP is the only income-driven option for borrowers with newer loans, and it calculates your payment differently than the legacy income-driven plans do:
- Eligibility: Open to most direct loan borrowers, whether their loans are new or from before July 1, 2026; parent PLUS loans aren't eligible
- How payments work: Your payment is based on adjusted gross income rather than discretionary income. It starts at a flat $10 a month for the lowest earners. From there, it rises by about 1 percentage point for every $10,000 of income, up to 10% of AGI above $100,000. Your payment drops by $50 a month for each dependent you claim.
- Repayment term: 30 years
- Loan forgiveness: Any remaining balance is forgiven after 30 years. Unpaid interest is waived each month, and the government adds up to $50 toward your principal if your payment doesn't meet that threshold. RAP is also eligible for PSLF and Teacher Loan Forgiveness.
- Best for: New borrowers with lower incomes, and legacy borrowers whose income would produce a lower payment under RAP than under their current plan
Tiered Standard Plan
The tiered standard repayment plan replaces the old standard plan as the default for new federal loans. It adjusts your repayment term based on how much you owe instead of using a flat 10 years for everyone:
- Eligibility: All direct loan borrowers with loans disbursed on or after July 1, 2026. Borrowers with older loans may also choose to switch to this plan.
- How payments work: Your fixed monthly payment is calculated to pay off your balance, plus interest, within your assigned term, with a minimum payment of $50 a month.
- Repayment term: 10 years for balances under $25,000, 15 years for $25,000 to $49,999, 20 years for $50,000 to $99,999, and 25 years for $100,000 or more
- Loan forgiveness: Teacher Loan Forgiveness; payments don't count toward PSLF
- Best for: New borrowers who want predictable payments and don't expect to need an income-driven option
How to Choose the Best Student Loan Repayment Plan
Once you know which plans you're eligible for, a few factors can help narrow down the right one for you:
- Monthly payment: Compare what each plan you're eligible for would actually cost you now. If a fixed payment under the standard or tiered standard plan fits your budget, it may save you the most money over time. If it doesn't, an income-driven plan can free up cash for other priorities.
- Financial goals: Consider whether you're working toward forgiveness, trying to pay off debt quickly or prioritizing a low payment while you build savings.
- Long-term costs: A lower monthly payment often means paying more interest over a longer term—though remember that RAP subsidizes unpaid interest for lower-income borrowers. Compare the total cost of each plan over its full repayment period before you commit to one that stretches on for decades.
You can compare estimated payments across every plan you qualify for using the Department of Education's repayment calculator at StudentAid.gov. Once you've settled on an option, contact your loan servicer to make the switch.
Frequently Asked Questions
What's the Difference Between IDR, IBR and ICR Plans?
Income-driven repayment is the umbrella term for any plan that bases your payment on income, including IBR, ICR, PAYE and RAP. Each specific plan within that group comes with its own payment calculation and forgiveness timeline.
Is the SAVE Repayment Plan Still Available?
No. A federal court vacated the SAVE Plan's rules in March 2026, and servicers began notifying remaining SAVE borrowers on July 1, 2026. Each notice starts a 90-day clock to pick a new plan before you're automatically placed in one.
How Does Repayment Work for Private Student Loans?
Private lenders set their own repayment terms, since these loans aren't backed by the federal government. Most don't offer income-driven payments, though some may allow temporary reductions if you're struggling. Refinancing student loans can lower your rate, but it means giving up federal protections like forgiveness.
The Bottom Line
No single student loan repayment plan works best for everyone, and the plan that you're currently on may not be the right one for you. Review your options based on when your loans were disbursed, then run the numbers on what each plan would actually cost you. Revisit your choice whenever your income or goals change, since most borrowers can switch plans more than once.
As you work through repayment, paying on time is one of the best ways to build strong credit. Monitoring your credit can help you track your progress and catch problems early.