Overview
Federal student loan repayment structures are expected to change significantly over the coming years.
Students already enrolled may qualify for a temporary protection period.
The 3-Year Legacy Rule: If you or your parents borrowed a federal student loan (Direct or PLUS) for a term that began before July 1, 2026, you are considered a "legacy borrower." You can continue to borrow under the old, higher limits (including Grad PLUS) for the remainder of your current program, or for three academic years, whichever is shorter.
To keep this legacy status, you must stay continuously enrolled in the same program. If you switch schools, change degree types, or take an unapproved leave of absence, you will lose your legacy status and be switched into the new OBBB limits.
Repayment Plan Changes
The OBBBA introduces:
- A new standard repayment structure
- A new income-driven repayment option called the Repayment Assistance Plan (RAP)
What Students Should Know
Several older repayment plans are expected to be phased out by July 1, 2028 as the federal repayment system is streamlined.
Students currently borrowing federal loans should:
- Monitor federal updates closely
- Borrow conservatively when possible
- Understand future repayment obligations
