RAP or the Standard plan? See what your federal loan will actually cost
From July 2026, new federal student loans have two repayment plans: a fixed Tiered Standard plan and the income-based RAP. Drag the sliders to compare them for your balance and income.
The question we keep seeing
“The student loan rules changed in 2026. Which repayment plan should I expect to be on, and what will I pay each month?”
The short answer
- Federal Direct Loans made on or after July 1, 2026 have two repayment plans: the Tiered Standard plan and the Repayment Assistance Plan (RAP).
- The Standard plan is a fixed payment over 10 to 25 years, depending on how much you owe. RAP is 1% to 10% of your income, less $50 a month per dependent, with any balance left after 30 years forgiven.
- RAP waives the interest your payment doesn't cover, so the balance can't grow. Low payments now usually mean more years of paying.
For years, borrowers chose between a long menu of repayment plans with confusingly similar names. For loans made from July 1, 2026 onward, the menu is down to twoFootnote 1Source 134 CFR 685.208, Repayment plans (eCFR, U.S. Department of Education)Sets the Tiered Standard plan terms by balance for loans made on or after July 1, 2026, with the Department's $30,000 example.ecfr.govFootnote 2Source 234 CFR 685.209, Income-driven repayment plans (eCFR, U.S. Department of Education)RAP rules: base payment by AGI band, $50 per dependent, $10 minimum, interest waiver, $50 principal match, forgiveness after 360 payments.ecfr.gov. Which one suits you depends on two numbers: how much you borrow and how much you earn once you leave school.
The calculator below runs both plans on the same loan. It opens at the 2026–27 undergraduate rate of 6.52%Footnote 3Source 3FSA Electronic Announcement GENERAL-26-33: 2026–27 Direct Loan interest rates (U.S. Department of Education)6.52% undergraduate, 8.07% graduate unsubsidized and 9.07% PLUS for loans first disbursed July 1, 2026 to June 30, 2027.fsapartners.ed.gov. Change the amount, your expected starting income and how fast it grows.
Two plans, one loan
Drag the sliders. The default rate is the 2026–27 undergraduate Direct Loan rate (6.52%).
Fixed for 15 years. Total repaid $47,099.
Rises with income. Paid off in about 17 years. Total repaid $49,788.
An estimate, not a quote. It assumes one loan at a fixed rate, steady income growth, the same number of dependents and every payment on time. Your servicer calculates your actual payment from your tax return each year. Check how forgiven balances are taxed for your situation.
Plan 1: the Tiered Standard plan
This is a classic fixed payment: the same amount every month until the loan is gone. What's new is that the length of the term depends on your total balance when you enter repaymentFootnote 1Source 134 CFR 685.208, Repayment plans (eCFR, U.S. Department of Education)Sets the Tiered Standard plan terms by balance for loans made on or after July 1, 2026, with the Department's $30,000 example.ecfr.gov:
- Less than $25,000: 10 years
- $25,000 to less than $50,000: 15 years
- $50,000 to less than $100,000: 20 years
- $100,000 or more: 25 years
A longer term means a smaller monthly payment and more interest in total. At 6.52%, $30,000 over the 15-year term is about $262 a month. Over ten years it would be about $341Footnote 1Source 134 CFR 685.208, Repayment plans (eCFR, U.S. Department of Education)Sets the Tiered Standard plan terms by balance for loans made on or after July 1, 2026, with the Department's $30,000 example.ecfr.gov.
Plan 2: the Repayment Assistance Plan
RAP sets your payment from your adjusted gross income (AGI) instead of from your balanceFootnote 2Source 234 CFR 685.209, Income-driven repayment plans (eCFR, U.S. Department of Education)RAP rules: base payment by AGI band, $50 per dependent, $10 minimum, interest waiver, $50 principal match, forgiveness after 360 payments.ecfr.gov. Each year:
- Start with a percentage of AGI. Income up to $10,000 pays a flat $120 a year. Above that it is 1% of AGI, rising one point for each $10,000 band, up to 10% above $100,000.
- Divide by 12, then subtract $50 for each dependent.
- The payment never drops below $10 a month.
Two features make RAP gentler than older income-driven plans. If your on-time payment doesn't cover the month's interest, the unpaid interest is not charged, so the balance can't grow. And if your payment cuts the principal by less than $50, the Department of Education makes up the difference, up to $50 and never more than you paidFootnote 2Source 234 CFR 685.209, Income-driven repayment plans (eCFR, U.S. Department of Education)RAP rules: base payment by AGI band, $50 per dependent, $10 minimum, interest waiver, $50 principal match, forgiveness after 360 payments.ecfr.gov. After 360 qualifying payments, which is 30 years, whatever is left is forgivenFootnote 2Source 234 CFR 685.209, Income-driven repayment plans (eCFR, U.S. Department of Education)RAP rules: base payment by AGI band, $50 per dependent, $10 minimum, interest waiver, $50 principal match, forgiveness after 360 payments.ecfr.gov.
What the calculator can't know
- Your real income path. RAP is recalculated every year from your tax return. Steady growth is a convenient assumption, not a forecast.
- Marriage. Filing jointly can change what counts as your AGI.
- Other loans. Loans made before July 2026, Parent PLUS loans, and private loans follow different rulesFootnote 2Source 234 CFR 685.209, Income-driven repayment plans (eCFR, U.S. Department of Education)RAP rules: base payment by AGI band, $50 per dependent, $10 minimum, interest waiver, $50 principal match, forgiveness after 360 payments.ecfr.gov.
- Taxes on forgiveness. Whether a forgiven balance is taxed depends on the tax law in force when it happens. Check before you count on it.
The cheapest loan is still the one you don't take out. Before you borrow, find out how much federal aid can cover (the borrowing limits are here) and compare real aid offers side by side.
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Frequently asked
For Direct Loans made on or after July 1, 2026, there are two: the Tiered Standard plan (a fixed payment over 10 to 25 years depending on your balance) and the Repayment Assistance Plan (RAP), which bases the payment on your income.
Take 1% to 10% of your adjusted gross income, depending on your income band ($120 a year if AGI is $10,000 or less), divide by 12, then subtract $50 per dependent. The minimum payment is $10 a month.
No. If an on-time payment doesn't cover the month's interest, the unpaid interest is not charged. If your payment reduces principal by less than $50, the Department of Education matches the shortfall up to $50.
After 360 qualifying monthly payments, which is 30 years. Check how the forgiven amount is taxed under the law in force at the time.
For loans first disbursed from July 1, 2026 to June 30, 2027: 6.52% for undergraduates, 8.07% for graduate unsubsidized loans, and 9.07% for PLUS loans. The rate is fixed for the life of the loan.