Available Student Loan Repayment Plans Following the FY2025 Budget Reconciliation Law
Summary
Available Student Loan Repayment Plans Following the FY2025 Budget Reconciliation Law
P.L. 119-21, the FY2025 budget reconciliation law, amends the Higher Education Act to change student loan repayment plan availability under the Direct Loan program. For borrowers of loans made before July 1, 2026, current plans remain available until July 1, 2028, on which date, borrowers in income-contingent repayment (ICR) plans will be transitioned to other available plans. For borrowers of new loans made on or after July 1, 2026, two newly enacted plan options will replace current plans. This infographic presents changes to repayment plan availability from enactment through July 1, 2028.
For All Borrowers
Date of Enactment July 4, 2025
Fixed repayment plans
Standard 10-year repayment plan
Extended repayment plan
Graduated repayment plan
Alternative repayment plans
IDR plans
IBR plans
ICR plans*
For Borrowers of Loans Made Before July 1, 2026 (assumes borrower does not take out new loans on or after July 1, 2026)
New Plans Become Available
Fixed repayment plans
Standard 10-year repayment plan
Extended repayment plan
Graduated repayment plan
Alternative repayment plans
IDR plans
IBR plans
ICR plans
RAP
For Borrowers of New Loans on or After July 1, 2026 (also applies to borrower's loans made before July 1, 2026)
Fixed repayment plans
Standard 10-year repayment plan
Extended repayment plan
Graduated repayment plan
Tiered standard repayment plan
Alternative repayment plans
IDR plans
IBR plans
ICR plans
RAP
ICR Plans Repealed July 1 2028
Fixed repayment plans
Standard 10-year repayment plan
Extended repayment plan
Graduated repayment plan
Alternative repayment plans
IDR plans
IBR plans
ICR plans
RAP
Fixed repayment plans
Tiered standard repayment plan
IDR plans
RAP
Newly enacted repayment
plan in P.L. 119-21
Not available
IBR - Income-based repayment
ICR - Income-contingent repayment
IDR - Income-driven repayment
RAP - Repayment Assistance Plan
*Consists of the income-contingent repayment, Pay As You Earn, and Saving on a Valuable Education plans
Transition Out of ICR
Before July 1, 2028, borrowers enrolled in an ICR plan must select another plan available to borrowers of loans made before July 1, 2026.
If they do not make a selection by July 1, 2028, ED will enroll:
all RAP-eligible loans RAP
all non-RAP-eligible loans IBR
Newly Enacted Plans in P.L. 119-21
Tiered standard repayment plan
Fixed monthly payments so that borrower repays loan over a specified repayment term
Repayment term based on outstanding principal balance (10 to 25 years)
RAP
Monthly payments equal to one-twelfth of 1% to 10% of total income
Interest not covered by monthly payment is not charged to borrower
Monthly principal reduction of upto $50 ("matching principal payment")
Maximum repayment periodof 30 years
For additional information on changes to repayment plans made by P.L. 119-21, see CRS Report R48727, Amendments to the Higher Education Act Made by P.L. 119-21, the FY2025 Budget Reconciliation Law.
Information as of March 12, 2026. Prepared by Rita Zota, Analyst in Education Policy, and Mari Lee, Visual Information Specialist.