RAP removed the payment cap. High earners feel that first
The Repayment Assistance Plan has no ceiling tied to the 10-year standard plan, so some borrowers pay more than they would have under IBR.
this story***NO CAP
Payment ceiling · IBR capped at 10-yr standard
Unlike IBR, which capped payments at what a borrower would pay on a 10-year standard plan, the Repayment Assistance Plan applies no ceiling. Payments run from 1% to 10% of adjusted gross income across 11 brackets, so higher earners can pay more under RAP than under the plan it replaced.
The change that moves the most money in the Repayment Assistance Plan is not the percentages. It is a removed ceiling.
What IBR did
Income-Based Repayment calculated a payment from your income — and then capped it. Your payment could never exceed what you would have paid on a 10-year standard plan. If your income rose enough that the formula produced a bigger number, the cap held it down.
What RAP does
RAP has no cap. The formula runs your adjusted gross income through 11 brackets charging 1% to 10%, subtracts $50 per dependent, applies a $10 minimum — and whatever that produces is your payment.
For a borrower whose income has grown well past their original balance, that is the difference between a capped payment and an uncapped one.
Who is affected, in order
- High earners with modest balances. The cap was doing the most work for exactly this group. Without it, an income-driven plan can cost more than a standard one.
- Borrowers with no dependents at the top brackets. The $50 per dependent deduction is the main offset in the formula, and it does not apply.
- Low-income borrowers. Less exposed to the cap change, but the $10 floor means there is no longer a $0 month.
The line that decides which rules you get
Loans first disbursed before July 1, 2026 keep access to legacy plans — as long as you take out no additional federal loans. Borrow again after that date and you are limited to the Tiered Standard Repayment Plan or RAP.
Returning to school is the most common way people cross that line without meaning to.
Questions people ask
Am I moved to RAP automatically?
No. RAP is the only income-driven option for loans first disbursed on or after July 1, 2026. Existing borrowers who take no new loans keep access to legacy plans.