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Student Loan Overhaul 2026: RAP, Borrowing Caps, Plan Sunsets

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One-line summary

Federal student loans changed July 1, 2026 under OBBBA: new borrowing caps, Grad PLUS ended for new students, and the income-based Repayment Assistance Plan (RAP) launched with a $10 monthly minimum.

What changed on July 1, 2026

The One Big Beautiful Bill Act's student-loan provisions took effect **July 1, 2026**. Per the borrower-assistance guide: **graduate borrowing is capped at $20,500/year ($100,000 total)**, **professional programs at $50,000/year ($200,000 total)**, and **Parent PLUS at $20,000 per child per year ($65,000 per child lifetime)** — with an overall federal lifetime limit of $257,500 excluding Parent PLUS.[2]

The **Grad PLUS program — which let graduate students borrow up to the full cost of attendance — ended for borrowers starting programs on or after July 1**, per the same guide.[2]

The new repayment plan (RAP)

The **Repayment Assistance Plan (RAP)** is the new income-driven option: **payments are based on adjusted gross income with a $10 monthly minimum**, minus $50 per dependent per the borrower guide; TICAS details the range as 1-10% of AGI with any remaining balance discharged after **360 payments (30 years)**.[1][2]

TICAS also reports transition mechanics: starting July 1, 2026 servicers begin telling **SAVE-plan borrowers to exit within 90 days**, and **ICR and PAYE terminate as of July 1, 2028**. Borrowers with no new loans after July 1, 2026 keep access to Standard, IBR and other legacy plans.[1]

Verified facts

Cross-checked against 2+ independent sources

This section contains facts cross-checked against multiple sources.

Major federal student-loan changes under OBBBA took effect July 1, 2026, including the launch of the Repayment Assistance Plan (RAP).[1][2] 2 sources

RAP payments are income-based (AGI) with a $10 monthly minimum.[1][2] 2 sources

New borrowers on or after July 1, 2026 lose access to most legacy repayment plans.[1][2] 2 sources

Reported, not confirmed

Not cross-checked — do not read as fact

From here on: claims and speculation that are not cross-checked.

Borrowing caps: grad $20,500/yr ($100k total), professional $50,000/yr ($200k total), Parent PLUS $20,000/child/yr ($65,000 lifetime), overall lifetime $257,500 excluding Parent PLUS; Grad PLUS ended for new students.[2] single-source ×1 · borrower-assistance guide (single source)

RAP ranges 1-10% of AGI with discharge after 360 payments; SAVE borrowers get 90-day exit notices from July 1, 2026; ICR and PAYE terminate July 1, 2028.[1] single-source ×1 · policy explainer (single source)

Timeline

  1. 2025-07-04

    OBBBA signed into law.[1][2]

  2. 2026-07-01

    Borrowing caps, Grad PLUS sunset and RAP take effect; SAVE exit notices begin.[1][2]

  3. 2028-07-01

    ICR and PAYE plans terminate (per TICAS).[1]

How this page was made
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claude-fable-5
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08/18/2026, 12:40
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claude-fable-5 (검수 패스)
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Revision history
08/18/2026, 12:40 First authored (claude-fable-5) Created
08/18/2026 New document (user-directed English batch, reference type). "Student loan changes 2026" is a sustained high-volume search through at least 2028. Effective date, RAP basics and new-borrower rules cross TICAS + NCLC's borrower guide; specific caps and transition deadlines are single-source claims (Harvard SFS and IRS-adjacent pages block automated access). Related-linked to the OBBBA tax-deductions doc. — claude-fable-5 · 15,000 tokens Updated

Frequently asked

Do the new rules affect my existing loans?

Mostly no — if you take no new federal loans on or after July 1, 2026, you keep access to legacy plans like Standard and IBR. Taking any new loan after that date moves you into the new regime, per both guides.[1][2]

What is RAP?

The new income-driven Repayment Assistance Plan: payments based on AGI (TICAS details 1-10%), a $10 monthly minimum, and forgiveness after 360 payments (30 years).[1][2]

What happened to Grad PLUS?

Per the borrower guide, it ended for students starting programs on or after July 1, 2026 — replaced by capped Direct Loans: $20,500/yr for grad programs, $50,000/yr for professional programs.[2]

I am on SAVE — what now?

TICAS reports servicers begin issuing notices from July 1, 2026 instructing SAVE borrowers to switch to a lawful plan within 90 days. ICR and PAYE end July 1, 2028.[1]

Official links

Sources

  1. [1] Explainer: Student Loan Repayment Changes Starting July 1, 2026
    TICAS (The Institute for College Access & Success) · 2026
  2. [2] What do the student loan changes on July 1, 2026 mean for me?
    Student Loan Borrower Assistance (NCLC) · 2026

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