Federal Student Loan Repayment Plans
Paying back your student loans can feel overwhelming, but the U.S. Department of Education offers several repayment plans that can make it easier. Some plans are based on how much money you make, while others follow a fixed schedule.
Income-Based Repayment (IBR)
This plan sets your monthly loan payment based on your income and family size not how much you owe.
Payments are usually 10% or 15% of your monthly income.
After 20 or 25 years, any remaining loan balance may be forgiven.
You must recertify your income and family size each year.
Learn more: Income-Based Repayment Plan (IBR)
Pay As You Earn (PAYE)
This plan also bases your payment on your income but usually offers even lower payments.
Payments are 10% of your income (but never more than the 10-year plan).
You must be a new borrower after Oct. 1, 2007.
Remaining balance may be forgiven after 20 years.
Learn more: Pay As You Earn (PAYE) Plan
Saving on a Valuable Education (SAVE)
This is the newest and most affordable income-driven repayment plan.
Payments are based on discretionary income but more generous than other plans.
May reduce payments to $0/month for low-income borrowers.
No unpaid interest will build up if your monthly payment doesn’t cover it.
Learn more: SAVE Plan Overview
Income-Contingent Repayment (ICR)
A flexible plan for those who don’t qualify for IBR or PAYE.
Payments are 20% of your income or what you'd pay on a 12-year plan whichever is less.
Remaining debt is forgiven after 25 years.
Good option for Parent PLUS Loan borrowers (after consolidation).
Learn more: Income-Contingent Repayment (ICR)
The 10-Year Standard Repayment Plan
This is the default plan most borrowers start with.
Pay the same amount every month for 10 years.
You’ll pay off loans faster and pay less interest.
Best for people who can afford higher payments.
Learn more: Standard Repayment Plan
Choosing the Right Plan
Not sure which repayment plan is best for you? Use the Loan Simulator to compare your options and see what your payments could look like.
Resource: Loan Simulator Tool
Helpful Tools & Resources
2026-27 Updates
Overview
Significant changes to federal student loan policies are coming in July 2026 under H.R. 1. These changes will impact how students borrow, repay, and manage their loans, with major implications for financial aid professionals and institutions.
Key Points
New Repayment Options Only
Borrowers will choose between a 10–25 year Fixed Payment Plan or a new Income-Based Repayment plan (1–10% of income with forgiveness after 30 years). All current repayment plans like SAVE and REPAYE will be phased out.
Tighter Deferment and Forbearance Rules
Borrowers can only use a maximum of 9 months of deferment or forbearance in any 24-month period.
Quick Tips
Income-driven plans like IBR, PAYE, SAVE, and ICR set your monthly payments based on income and may forgive remaining debt after 20–25 years.
The SAVE plan can reduce your payment to $0 and protect against unpaid interest if you're low-income.
Standard 10-year repayment pays off loans fastest and with the least interest but requires higher monthly payments.
Use the Dept. of Education’s Loan Simulator to compare plans and find the best fit.