When do PAYE and ICR end?

Both sunset permanently on 1 July 2028. New enrolments into PAYE close earlier, on 1 July 2027. Borrowers still in PAYE or ICR when the plans end are moved to IBR or RAP, and the default placement is RAP. Because that default is usually the more expensive option, choosing actively before the deadline is worth the hour it takes.

What happens if I do not choose a repayment plan?

You are placed into RAP automatically when PAYE and ICR sunset on 1 July 2028. Our analysis comparing both plans across twenty household types found RAP produced the lower monthly payment in only three of them, and never by more than $50.50 a month, while IBR won the remaining seventeen by as much as $554.50. Passive selection is therefore likely to cost you money.

Is RAP or IBR cheaper?

IBR, in most cases. The structural reason is that IBR calculates payments on discretionary income — what is left after setting aside 150% of the federal poverty guideline for your household size — while RAP calculates on total adjusted gross income with only a small per-dependent offset. Above roughly $100,000 of income the gap settles at a constant equal to 1.5 times the poverty guideline times 10%, divided by 12. Larger households are affected most, because the sheltered amount grows with household size.

Is RAP ever the better choice?

Yes, in specific cases. At very low incomes RAP’s $10 minimum and its 0% band below $10,000 of AGI can beat IBR. RAP also waives unpaid interest each month, so the balance does not grow while you make qualifying payments — which can matter more than the monthly figure for a borrower who expects to stay on an income-driven plan for the full term and never repay in full. Against that, RAP forgives after 30 years where IBR forgives after 20 or 25.

What happened to the SAVE plan?

It was ended by a federal appeals court judgment on 10 March 2026, which vacated the 2023 rule that created it. Borrowers enrolled in SAVE have been migrated to other plans. If you were among them, it is worth confirming which plan you were placed into, because the placement was not necessarily the least expensive option for your circumstances.

Which plan is better if I am going for PSLF?

Whichever gives you the lowest monthly payment, because the goal is 120 qualifying payments followed by discharge — anything paid above the minimum is money you did not need to spend. Both RAP and IBR qualify for PSLF, so the decision reduces to the payment comparison, and for most borrowers our study found that favours IBR. Check before submitting employer certification rather than after.

The Student Loan Deadlines That Move You Into RAP Automatically

Two deadlines will move you into RAP whether you choose it or not.

SAVE was vacated in March. New PAYE enrolments close on 1 July 2027, and PAYE and ICR sunset entirely on 1 July 2028. Borrowers who have not actively chosen by then are placed into RAP by default — and our own crossover analysis found RAP is the cheaper plan in only three of twenty household types.

By TallyBench Team · July 29, 2026 · 8 min read

The US income-driven repayment landscape has been rebuilt over eighteen months, and the part that matters most is not the new plan itself. It is the set of dates that will make a decision for you if you do not make one yourself.

The three dates: 1 July 2026 — RAP became available, and is the only IDR plan for loans taken from that date. 1 July 2027 — no new enrolments into PAYE. 1 July 2028 — PAYE and ICR sunset permanently, and borrowers still in them are moved to IBR or RAP. Default placement is RAP.

How the ground shifted

SAVE no longer exists. A federal appeals court judgment on 10 March 2026 vacated the 2023 rule that created it, ending the plan for everyone who had enrolled. That removed what had been the most generous option for a large number of borrowers, and forced a migration that is still working through the system.

RAP — the Repayment Assistance Plan — arrived on 1 July 2026 under the FY2025 reconciliation law. For loans disbursed on or after that date it is the only income-driven option. For older Direct Loans it is one choice among several, which is where the decision actually lies.

Why the default matters so much

We computed both plans across every income from $0 to $300,000 and twenty household types. The full study is here, and the summary is uncomfortable for anyone about to be auto-enrolled:

RAP produced the lower monthly payment in three of the twenty household types — and never by more than $50.50 a month. IBR won the other seventeen, and by as much as $554.50.

The mechanism is structural rather than incidental. IBR calculates payments on discretionary income — what remains after 150% of the federal poverty guideline for your household size is set aside. RAP calculates on total adjusted gross income, with a smaller per-dependent offset. Above roughly $100,000 the gap between the two settles at a constant: 1.5 × the poverty guideline × 10% ÷ 12.

Because RAP does not shelter a poverty-line amount before applying its rate, larger households are hit hardest — the poverty guideline rises with household size, so the amount IBR protects and RAP does not grows with every dependent.

Where RAP is genuinely better

It would be wrong to read this as "RAP is bad". It is better in specific, identifiable cases and those cases are worth knowing.

Very low incomes. RAP has a $10 minimum payment and its percentage scale starts at 0% below $10,000 of AGI. For a borrower earning very little, RAP can produce a lower payment than IBR's discretionary-income formula.

Interest treatment. RAP waives unpaid interest each month, so balances do not grow while you make qualifying payments. IBR has no equivalent subsidy after its limited initial period. A borrower who expects to be on an IDR plan for the full term, never paying the loan off in full, may prefer the plan that stops the balance compounding — even at a slightly higher monthly payment.

Forgiveness timeline. RAP forgives after 30 years. IBR forgives after 20 or 25 depending on when you borrowed. That is a point against RAP for most, but interacts with the interest waiver in ways that depend on your balance trajectory.

PSLF is the case where the arithmetic inverts

If you are pursuing Public Service Loan Forgiveness, the logic reverses entirely. You are aiming for 120 qualifying payments and then discharge, so the lowest possible monthly payment is the goal — every rupee, or dollar, paid above the minimum is money you did not need to pay.

Both RAP and IBR are PSLF-qualifying plans. So the choice reduces to whichever produces the smaller monthly payment for your circumstances, and for most borrowers our analysis says that is IBR. Run both before your employer certification, not after — our PSLF calculator projects the remaining qualifying payments.

What to do, and when

If you are in PAYE or ICR today: you have until 1 July 2028, but no reason to wait. Compare IBR against RAP on your actual numbers and move deliberately rather than being placed.
If you were in SAVE: you have already been moved. Check which plan you landed in — the placement was not necessarily the cheapest one for you.
If you borrowed on or after 1 July 2026: RAP is your only IDR option. The decision is not which plan, but whether an IDR plan or the standard plan serves you better.
If you are close to the IBR eligibility test: IBR requires a partial financial hardship to enter. That test is based on income relative to the standard 10-year payment, so a raise can cost you eligibility. If IBR is materially better for you, entering while you qualify is worth doing.
Recertify on time, every year. Missing recertification can push you to a standard payment and capitalise accrued interest — a larger and more immediate cost than choosing the wrong plan.

The one-line version: doing nothing is a choice, and on 1 July 2028 it selects RAP. For most borrowers our analysis found that is the more expensive outcome — by up to $554.50 a month. Deciding actively costs an hour. Deciding passively can cost considerably more than that.

Compare RAP against IBR → Read the full study PSLF Calculator