Student Loans

Pay As You Earn

Ten percent of discretionary income, capped at the ten-year Standard payment, forgiven after twenty years. Closed to new loans and eliminated entirely in 2028.

How it works

  • Closed to anyone with a loan disbursed on or after 1 July 2026, and eligible borrowers had to enrol before 1 July 2027.
  • Terminates on 1 July 2028 by statute, whoever is on it.

Compare this against the other plans

Sources

  1. Repayment plans and important definitions, U.S. Department of Education. Checked on . Backs which plans are open to which borrowers from 1 July 2026; the Tiered Standard term brackets and its $50 minimum; the effect of a single post-cutover disbursement on all of a borrower's loans.
  2. Income-driven repayment plans, U.S. Department of Education. Checked on . Backs the IBR, PAYE and ICR formulas and forgiveness horizons.
  3. Court actions affecting income-driven repayment, U.S. Department of Education. Checked on . Backs the status of SAVE after the 10 March 2026 order; the 1% automatic debit reduction; that income-driven payment counters are not currently displaying.
  4. Reimagining and Improving Student Education (RISE): Federal Student Loan Program, final regulations, Office of the Federal Register. Checked on . Backs the regulation implementing the plan changes, effective 1 July 2026.

Checked on .