Student Loan Changes starting July 1st, 2026
Starting Wednesday July 1st, students will begin to experience the changes to federal student loan payment plans because of the One Big Beautiful Bill (OBBBA). USSA understands that these changes can be confusing but we got your back. This is what you need to know to stay informed on your student loans.
Things to know...
Why are we talking about the OBBBA?
The One Big Beautiful Bill Act (OBBBA) is a new federal law (signed July 4, 2025) that made significant changes to higher education funding and the federal student loan system. The law changes how students can borrow to pay for college, limits some federal loan options, creates a new repayment system for future borrowers, and phases out or changes several existing repayment plans. These changes affect both current student loan borrowers and students who plan to borrow federal loans in the future.
What is the SAVE Plan?
The Saving on a Valuable Education (SAVE) Plan was an income-driven federal student loan repayment plan designed to make monthly payments more affordable based on a borrower's income and family size. Under recent changes to federal law, the SAVE Plan is being phased out. Borrowers currently enrolled in SAVE will receive instructions from their loan servicer about their next repayment options and should pay close attention to any deadlines to select a new plan.
How do I find my student loan servicer?
You can find your federal student loan servicer by logging into your account at StudentAid.gov using your FSA ID.
Once you're logged in:
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Go to your Dashboard.
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Select My Aid to view your federal student loans.
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Your loan servicer's name and contact information will be listed with your loan details.
If you have private student loans, contact your lender directly or check your credit report to identify your loan provider.
Keeping your contact information up to date with both StudentAid.gov and your loan servicer is one of the best ways to ensure you receive important updates about your repayment options.
StudentAid.gov is the U.S. Department of Education's official website for managing your federal student aid and loans. As changes to the federal student loan system take effect, this is the best place to stay informed and take action.
Not sure which repayment plan is right for you?
Not sure which repayment plan is right for you?
This easy-to-read comparison chart breaks down the key differences between today's federal income-driven repayment plans, including eligibility, monthly payment formulas, repayment timelines, interest benefits, and forgiveness options. Whether you're trying to understand your current plan or preparing for upcoming changes, this guide is a great place to start. Download the PDF by our partners at TICAS to compare your options side by side.
If you’re a new student starting college this fall (2026) and are taking out student loans.
You will now only have two repayment plan options to repay those loans. The tiered standard repayment plan which sets your monthly bill based on how much you borrowed and the repayment assistance plan (RAP), the only income based option for new borrowers.
Tiered Standard repayment plan
This plan divides a borrower’s principal and interest into equal monthly payments over a set period. The period of time grows with the size of the debt.
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If you owe less than $25,000 — repay over 10 years
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If you owe $25,000-$49,999 — repay over 15 years
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If you owe $50,000-$99,999 — repay over 20 years
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If you owe $100,000 or more — repay over 25 years
Repayment Assistance Plan (RAP)
RAP bases monthly payments on a borrower’s adjusted gross income. Basically the more you make, the higher your monthly payment. If your payment is smaller than the interest charge that month, RAP just cancels out the extra interest instead of tacking it onto your loan.
For example:
If you earn: Your monthly payment is about:
$30,000-$40,000 $75-$100
$50,000-$60,000 $208-$250
Incoming and Current students
Loan Borrowing Caps Updates:
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Graduate students: capped at $20,500/year, $100,000 lifetime (previously could borrow up to full cost of attendance via Grad PLUS)
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Professional students: (law, medical, etc.): capped at $50,000/year, $200,000 lifetime
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Parent PLUS borrowers: capped at $20,000/year, $65,000 lifetime per student (previously up to full cost of attendance)
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Overall lifetime cap of $257,000 for any federal student loan borrower, starting July 1
Changes for Current Borrowers: Repayment Plan Changes
SAVE plan borrowers:
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Starting July 1, 7+ million borrowers on SAVE will get email notices from their loan servicer
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You have 90-day window to choose a new repayment plan, the deadline is September 30th
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If you don’t choose one: you’ll be automatically placed into the Standard Plan which is one of the most expensive options
Income-based plans:
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Borrowers currently enrolled in the Pay-As-You-Earn Plan or Income Contingent Plan can remain on those plans until they are phased out in July 1st, 2028
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Borrowers in Income Based repayment plans can remain on these plans if they choose to
If you are a student loan borrower, check on your loan status by logging into StudentAid.gov, make sure your contact information is current so that you are getting any and all updates. If you want to compare what your monthly bills could look like under the different repayment options, this repayment calculator tool can be a great resource.
