Student lending

An IDR plan bases the amount of your monthly student loan payment on your income and family size. Monthly payment amounts are generally a percentage of your discretionary income (the difference between your income and the poverty guideline for your situation), although each IDR plan uses a different calculation to determine the exact monthly payment amount. 

Each year you are enrolled in an IDR plan, you must give your servicer updated information on your income and family size. This process is called “recertification,” because you are recertifying your eligibility for the plan you have selected. 

After you have made monthly payments equivalent to the length of the repayment term for your IDR plan, any remaining balance on the loans should be forgiven. To learn more about forgiveness, please visit our section on student loan forgiveness.

To enroll in an IDR plan, you can submit an online application through the FSA website or a paper application to your servicer. Note that paper application processing is greatly delayed; online applications will be processed more quickly. 

To determine which IDR plan is right for you, we recommend that you contact EDCAP to discuss which plan makes the most sense for your situation.

For more detailed information on IDR:

• Consult FSA’s page on IDR plans.
• Use EDCAP’s IDR plan-comparison tool to understand the differences among IDR plans.
• It’s important to use concrete numbers when trying to decide what plan is right for you: Call FSA’s Information Center (1-880-4FED-AID (433-3243), Deaf or hard of hearing 1-800-730-8913) to find out what your payment amount would be on each plan.
• Schedule an appointment with EDCAP for a free counseling session to discuss your options.

Status of SAVE plan 

• You might have heard of Saving on a Valuable Education (SAVE), the newest IDR plan. After certain states sued the federal government, a court issued an order blocking the SAVE plan on July 18, 2024. Borrowers currently enrolled in the SAVE plan have been placed in a forbearance pausing their payments.
• On August 1, 2025, interest began accruing on loans that are in the SAVE forbearance. This change means that, even though monthly payments are not due, the overall repayment amount will increase for loans in the SAVE forbearance.
• If you are currently enrolled in SAVE, you might want to consider enrolling in a different IDR plan. EDCAP can discuss your options with you.
• Visit FSA’s SAVE page for more information.

Traditional repayment plans (also called fixed-payment repayment plans) do not take your income into account. These plans base your monthly payment amount on how much you owe, your interest rate, and a fixed time period for repayment. Loan servicers manage traditional repayment plans internally; because traditional repayment plans do not have the eligibility requirements or monthly payment calculations that IDR plans have, servicers can generally switch borrowers into traditional plans without delay. To select a traditional repayment plan, contact your loan servicer.

To compare these plans, consult FSA’s page on fixed-payment repayment plans or EDCAP’s traditional plan comparison tool.

The new federal law signed on July 4, 2025, changed the payment plan options for both current and future borrowers. These changes are complex: You will have different repayment options depending on when you took out your loans. In addition, once you enroll in certain repayment plans, you might lose eligibility to enroll in other plans. 

Because the changes to repayment plans are so complicated, we will not discuss them in detail here. Instead, we encourage you to reach out to the resources listed in this guide, particularly EDCAP, to discuss the specifics of your situation. 

Big changes depending on when you took out your most recent loan

In addition, there are different circumstances for you depending on whether your loans were disbursed or consolidated before or on or after July 1, 2026.

Changes that affect all borrowers:

• Certain IDR plans will be phased out over time and will be unavailable to any borrowers. These include SAVE, Pay As You Earn (PAYE), and Income-Contingent Repayment (ICR).
• A new IDR plan called the Repayment Assistance Plan (RAP) will be available to all borrowers.
• A new Standard Plan will be available to all borrowers.

If your most recent loan was disbursed or consolidated before July 1, 2026: 

• You are eligible for RAP, which will be available at some point in 2026;
• You are eligible for an Income-Based Repayment (IBR) plan:
  • The new law eliminates the requirement that a borrower must have a “partial financial hardship” to enroll in an IBR plan.
  • This version of IBR should be available soon.
• You are eligible for Traditional repayment plans, including: Standard, Graduated, and Extended Plans.
• If you are a current borrower in ICR, PAYE, or SAVE, you must move into one of the following plans before July 1, 2028: RAP, IBR, Standard, Graduated, or Extended.

If your most recent loan was disbursed or consolidated on or after July 1, 2026:

• You are eligible for RAP.
• You are eligible for New Standard Plan.
• You cannot enroll in ICR, PAYE, SAVE, IBR, Extended Plan, Graduated Plan, or old Standard Plan.

Parent PLUS borrowers 

Different rules apply to Parent PLUS borrowers. Under the new law:

• All Parent PLUS borrowers are ineligible for RAP.
• If your Parent PLUS loan was disbursed or consolidated before July 1, 2026, you can enroll only in the Extended, Graduated, or old Standard plans.
• If your Parent PLUS was disbursed or consolidated on or after July 1, 2026, you can enroll only in the new Standard plan. 

If you have Parent PLUS loans, please seek guidance from EDCAP, FSA, or other resources on the best loan repayment strategy for you.

Loan consolidation means taking out one new loan to pay back other pre-existing loans. After consolidating, your old loans are paid off in full and you are responsible for making payments on your new loan.

There are many benefits and drawbacks to consolidating your federal loans. Learn more at FSA’s page on consolidating student loans or EDCAP’s comprehensive consolidation guide. As you consider consolidation, we urge you to reach out to an organization like FSA or EDCAP to discuss the specifics of your loans.

No charge for consolidation 

It is always free to consolidate federal loans through the Department of Education (ED). Be wary of private loan consolidation or refinancing “opportunities!” These are probably unnecessary for you. Many private companies encourage borrowers to use expensive private services, such as:

• Third-party debt relief scams. Some borrowers receive letters, phone calls, emails, or texts offering to provide loan consolidation through the federal government for a steep fee. These services are scams: Third-party groups are not affiliated with the federal government, and charge large fees to do something the government will do for free.
• Private consolidation or refinancing scams. Some private consolidation or refinancing programs are scams that lure borrowers in with low monthly payments. Later, these programs raise interest rates and payments, sometimes dramatically.
• Private loans. Other programs might provide attractive terms for certain borrowers – but if you consolidate federal loans into private loans, you could lose loan forgiveness or cancellation opportunities. Carefully research whether you will lose certain benefits. Consider reaching out to FSA or EDCAP to discuss your situation.

For more information on possible scams, see our page on student loan scams.

If you are experiencing short-term financial difficulties, you might want to postpone making loan payments for a short time. You have two options: deferment and forbearance. 

These might be good options if you are struggling to repay your loans due to a temporary circumstance. For example, if you are enrolled in school, serving active duty in the military or Peace Corps, or facing a short period of unemployment, deferment could be helpful. Some of these circumstances also might qualify for forbearance.

While deferment and forbearance are both types of pauses to your loans, they have different qualification requirements and different results based on your loans and specific circumstances. Keep in mind: 

• Interest will continue to accumulate under most circumstances and for most types of loans.
• Months spent in deferment or forbearance likely won’t count toward your IDR or PSLF payment count. 

Because of the complexity of the issues involved, we strongly recommend you reach out to FSA (1-880-4FED-AID (433-3243), TDD 1-800-730-8913) or EDCAP to discuss your options.

For more information on this topic, visit EDCAP’s page on postponing student loan repayment. Visit FSA’s website to learn more about the eligibility requirements for federal student loan deferment and forbearance. 

If you have private loans 

Note that deferment and forbearance options for private student loans are determined by the loan servicer, not by the federal government. If you have private student loans and are worried about making payments, reach out to your servicer as soon as possible to discuss your options.

Under certain income-driven repayment (IDR) plans and the new Repayment Assistance Plan (RAP), your remaining loan balance is forgiven after you have made monthly payments corresponding to the length of your repayment term:

• 20-year term: 240 qualifying monthly payments
• 25-year term: 300 qualifying monthly payments
• 30-year term: 360 qualifying monthly payments

This schedule might take some borrowers longer than the number of years of their loan term. For example, a borrower with a 20-year repayment term who misses twelve months of payments over the course of the 20 years will take 21 years to make 240 total payments. 

Note that IDR forgiveness applies only to certain types of loans.

Learn more about IDR forgiveness at the Federal Student Aid’s IDR forgiveness page or reach out to EDCAP.

You may qualify for Public Service Loan Forgiveness (PSLF) if you have made 120 qualifying payments on your federal loans while working in public service. Qualifying positions include federal, state, and local government positions, as well as jobs at not-for-profit organizations based in the U.S. 

There are some important PSLF limitations:

• PSLF is available only if you are on an IDR plan or the 10-year Standard Repayment Plan.
• PLSF is available only for certain types of loans.
• You must provide documentation to the Department of Education establishing that your employment qualifies. 

Note that PSLF has received increased political scrutiny over the past year. The federal government may make policy changes affecting PSLF. In addition, there may be legal challenges to any PSLF changes the government makes.

For more detailed information on PSLF, consult FSA’s PSLF page or EDCAP’s resources on getting Public Service Loan Forgiveness.

Under the Teacher Loan Forgiveness (TLF) program, if you teach full time for five complete and consecutive academic years in a low-income school or educational service agency, and meet certain other qualifications, you might be eligible for up to $17,500 of loan forgiveness. 

For more information on TLF, consult FSA’s Teacher Loan Forgiveness page. 

A Perkins loan is issued by the federal government but serviced by your educational institution. There is a specific type of loan forgiveness available if you have a Perkins loan and work in certain industries or have certain characteristics. 

Note that, if you consolidate a Perkins loan into other federal loans, you will no longer be eligible for forgiveness specific to Perkins loans. However, the consolidated loan might qualify for other types of forgiveness, such as IDR forgiveness or PSLF.

For more information, consult FSA’s federal Perkins loan cancellation and discharge page.

New York state offers certain loan forgiveness programs that provide awards if you are in certain types of qualifying employment. These types of employment include social work, farming, teaching, and certain public service legal fields. 

Note that, while these programs are described as “loan forgiveness,” they are actually awards you receive to allow you to pay down your own loan balances. 

For more information, consult the New York State Higher Education Services Corporation’s (HESC) page on loan forgiveness from New York state.

If you become totally and permanently disabled, you may qualify for federal student loan discharge. Total and permanent disability discharge requires documentation from the U.S. Department of Veterans Affairs, the Social Security Administration, or an authorized medical professional. For more information, visit FSA’s total and permanent disability discharge page or EDCAP’s disability discharge eligibility page.

You may qualify for a closed-school discharge if your school closed while you were enrolled. You could also qualify under other specific circumstances, such as if it closed during your approved leave of absence, or if you withdrew from school and the school closed within 180 days of your withdrawal. If you meet the eligibility requirements, your servicer should automatically send you an application for a closed school discharge.

For more information, visit FSA’s closed school discharge page.

You might qualify to have all or some of your loans discharged if your school engaged in certain types of misconduct related to the making of the loan, certified a loan that you were not eligible to receive, or failed to return unpaid funds to the federal government. 

If a loan was fraudulently made in your name because your signature was forged or your personal information was used without your permission, you might be eligible for a federal loan discharge. See FSA’s forgery discharge page for more information.  

To learn more about seeking federal student loan discharge in bankruptcy, visit FSA’s discharge in bankruptcy page.  

This is an increasingly common scam. Scammers, often calling themselves “document processing” or “debt relief” companies, contact you and offer loan consolidation for an upfront fee (often $799 or $999) and a recurring monthly payment. Document processing companies often pass themselves off as representatives of the Department of Education (ED), but in reality they are charging huge fees for a process that you could do online for free. The company takes an outrageous up-front fee as well as regular monthly payments while your student loans go unpaid.

If you receive offers for private refinancing that sound too good to be true, they probably are! Some borrowers receive offers advertising low monthly payments and low interest rates. But many private refinancing companies raise interest rates and payments over time, sometimes dramatically. Once your federal loans have been consolidated into private loans, it is very difficult or impossible to get the many protections and benefits available for student borrowers through ED. If you receive offers for private refinancing, read the terms and conditions very carefully, and even do outside research on the company making the offer. If you need assistance, you can reach out to ED or  EDCAP to discuss your situation.