IBR After 2028: What Happens When SAVE, PAYE, and ICR Are All Gone

Federal student loan repayment options have been shrinking. SAVE was terminated by federal court and OBBBA statute in 2026. PAYE and ICR will end on July 1, 2028. After that date, borrowers with federal student loans have exactly two income-driven repayment options: IBR (Income-Based Repayment) for loans disbursed before July 1, 2026, and RAP (Repayment Assistance Plan) for loans disbursed on or after that date.

If you're on PAYE or ICR right now, this affects you directly. Here's what the post-2028 landscape looks like and what to do about it.

The plans still available after July 1, 2028

Standard Repayment Plan: Fixed monthly payment over 10 years. Available to any federal borrower. No income test. Highest monthly payment, lowest total interest.

Extended Repayment Plan: Fixed or graduated payments over up to 25 years for borrowers with over $30,000 in Direct Loans. Lower monthly, more total interest. No income test.

Graduated Repayment Plan: Payments start low and increase every two years, finishing in 10 years (or up to 25 with Extended). No income test.

IBR (Income-Based Repayment): For borrowers whose loans were disbursed BEFORE July 1, 2026. Monthly payment is 10% or 15% of discretionary income (depending on when you first borrowed), with forgiveness after 20 or 25 years. IBR stays open indefinitely for eligible borrowers.

RAP (Repayment Assistance Plan): For borrowers whose loans were disbursed ON OR AFTER July 1, 2026. Monthly payment is 1% to 10% of adjusted gross income (scaled by income tier), $10 minimum, with forgiveness after 30 years.

That's it. Five plans. Two of them (IBR and RAP) are income-driven; three (Standard, Extended, Graduated) are fixed-payment.

Who has to switch, and when

If you're on SAVE right now: You've already been notified by your loan servicer. SAVE is terminated. You need to transition to another plan. Options depend on when you borrowed:

• Loans disbursed before July 1, 2026: You can transition to IBR (most common recommendation), Standard, Extended, or Graduated
• Loans disbursed after July 1, 2026: You transition to RAP, Standard, Extended, or Graduated

If you're on PAYE right now: You have until July 1, 2028 to switch. The Department of Education will auto-transition borrowers who don't choose. Auto-transition typically defaults to IBR for pre-2026 loans, but the exact policy for auto-transition is still being finalized. If you're on PAYE and doing well on it, plan to switch to IBR before the auto-transition happens so you have control over the change.

If you're on ICR right now: Same as PAYE. Ends July 1, 2028. Transition to IBR (if eligible), RAP (if you have post-July 2026 loans), or one of the fixed-payment plans.

If you're on IBR right now: You're set. IBR stays available. No action needed unless your circumstances change.

If you're on Standard, Extended, or Graduated right now: No change. These plans are unaffected.

How IBR and RAP compare

For borrowers eligible for either plan (which is rare, you'd need loans on both sides of the July 1, 2026 disbursement line), here's the practical comparison:

Which is better? It depends on your income trajectory.

• Low income, expected to stay low: RAP is generally better because the interest waiver prevents loan growth and the 1% floor for low earners produces very low monthly payments.
• Low income now, growing income later: IBR is generally better because the shorter forgiveness timeline (20-25 years) beats RAP's 30 years, even though monthly payments during low-income years are higher.
• Steady middle income: Roughly similar. Compare the monthly payment formulas at your actual income level.
• High income: Neither is particularly generous. Both cap at 10% of income (RAP) or 15% (IBR). Standard or Extended may finish faster with less total interest.

The forgiveness timeline is the big structural difference. IBR's 20-25 year path is meaningfully shorter than RAP's 30 years. If you're eligible for IBR and expect a career where you'll carry loan balances long-term (public interest, academia, government), IBR beats RAP.

What this means if you're borrowing new loans

If you're taking out federal loans for the 2026-27 school year, your income-driven option is RAP. Not IBR. Not SAVE. Not PAYE or ICR. Just RAP or the fixed-payment plans (Standard, Extended, Graduated).

Practical implications:

• Plan for a 30-year forgiveness horizon if you expect to use income-driven repayment long-term. That's a long time. RAP payments will follow you for most of your working career.
• The interest waiver is genuinely valuable. Your loan cannot grow from unpaid interest under RAP. Under old plans (including IBR), a low monthly payment could result in the balance ballooning because interest capitalized. RAP eliminates that.
• The 1% to 10% AGI scale is smoother than old plans. Old IDR plans had a cliff at the poverty line. RAP scales continuously with income, so a small raise doesn't produce a sudden payment jump.
• PSLF still works. If you plan to pursue public service loan forgiveness, RAP counts as a qualifying repayment plan.

What to do right now

Log into studentaid.gov and check your current repayment plan. Confirm whether you're on SAVE, PAYE, ICR, IBR, Standard, Extended, Graduated, or something else. Know your baseline.

If you're on SAVE, PAYE, or ICR, make an active choice about the transition. Don't let auto-transition make the decision for you. IBR is the usual recommended path for pre-2026 loans, but the right answer depends on your income and career trajectory.

If you have loans on both sides of July 1, 2026, evaluate consolidation carefully. Consolidating post-July-2026 loans with pre-July-2026 loans can affect which plan applies. The rules are complex; contact your loan servicer for a specific answer.

Don't panic about the 2028 date if you're on IBR now. IBR is not going away. It stays open for eligible borrowers. Only PAYE and ICR are ending in 2028, along with SAVE which already ended.

FAQ

Can I switch between IBR and RAP? Only if you have loans that qualify for each. IBR is for pre-July 2026 loans. RAP is for post-July 2026 loans. If all your loans are on one side of that line, you have one option, not both.

What happens if I don't choose a new plan before my current one ends? The Department of Education auto-transitions you. For SAVE borrowers, the transition is happening now (July-December 2026 for most). For PAYE and ICR borrowers, transitions will happen leading up to July 1, 2028. Auto-transition typically defaults to Standard for people who don't act, which can produce large payment increases. Actively choose your transition rather than letting the default happen.

Can I consolidate to get onto a different plan? Consolidation used to be a tool for accessing IDR plans. Post-OBBBA, consolidation of post-July 2026 loans still only qualifies for RAP or fixed-payment plans, so consolidation no longer unlocks IBR. If you're considering consolidation, do the math carefully with your loan servicer.

Does IBR count for PSLF the same as before? Yes. IBR remains a qualifying repayment plan for PSLF. RAP does too. If you're pursuing PSLF, either plan counts, though the plan you choose affects your monthly payment amount during the 120 qualifying payments.

What if I'm currently in default on federal loans? Get out of default first, then choose a repayment plan. You cannot access IBR or RAP while in default. Options include the Fresh Start program (if still available in your case), rehabilitation, or consolidation. Contact the Default Resolution Group at 1-800-621-3115 for specific guidance.

The federal repayment landscape after 2028 is simpler than the old system, but less flexible. If you're on SAVE, PAYE, or ICR now, choose your transition actively rather than accepting the default. If you're borrowing new loans, RAP is your income-driven option, and its 30-year horizon deserves a real look before you decide it's the right path.

Model your repayment scenarios on CollegeLens to see how different plans compare for your actual loan balance and expected income.

Sravani at CollegeLens

Related on CollegeLens

• Student Loan Repayment 2026
• OBBBA Overview