Student Loan Tracker

OBBBA triggers sweeping changes: SAVE, PAYE, ICR end; new RAP and Tiered Standard plans launch; borrowing caps for grad ($50k/year) and Parent PLUS ($20k/year annual, $65k lifetime); Graduate PLUS eliminated; PSLF employer eligibility narrowed. Nearly 1M of 7M+ SAVE borrowers have left the defunct plan (30% to RAP, 50% to IBR, 20% to older plans). New reports confirm a 90-day window to switch plans, contradicting earlier 12-month rumors. MOHELA says auto-enrollment will be into Tiered Standard (not Standard), which could be more expensive; political pressure for flexibility is mounting. Nelnet staggering notifications. Default surge confirmed: 9.5M borrowers now in default, totaling $233B, with South and Puerto Rico hardest hit, and for-profit school borrowers disproportionately affected. Nearly 12.5M at risk default. Wage garnishment has resumed. Parent PLUS consolidation window closed. Legal challenges ongoing, including SAVE lawsuit; judge blocked narrowed professional degree definition for healthcare. Bipartisan effort to exempt nursing from $100k cap. 46k signed up day one for RAP. Glitches persist. 1% autopay discount by Sept. 30; 400k have signed up. Racial equity lens: 45% in credit distress. Scam warning. Terry Savage warns new borrowers after July 1 lose legacy options; 90-day window critical. RAP forgiveness requires 30 years (statutory, not policy); payment formula is 1%-10% of income minus $50/child, with $10 minimum. PSLF counting is a key feature of RAP. **Critical trap: taking out a single new Direct Loan after July 1, 2026 can force all existing loans onto new plans, erasing IDR progress. This includes Parent PLUS: new Parent PLUS loans after July 1 lose IDR access entirely.** Borrowers returning to school must avoid new borrowing unless they understand the consequences; a 'returning student' exception may exist but is unclear. Racial equity: Black borrowers disproportionately affected. Forgiveness under new plans (RAP, Tiered Standard, IBR) is now taxable income, except for PSLF. Borrowers should use the new simulator and plan comparison tools to estimate tax liability. New RAP trap: even one day late on RAP payments forfeits interest waiver and principal match. Autopay is essential; monitor for errors. Legal challenges continue: lawsuits blocking professional degree definition, PSLF eligibility limits, and SAVE plan transition are ongoing. Practical advice: unemployed borrowers can use forbearance, IDR, hardship plans, and bill triage to avoid default. **New practical guidance: A recent article provides a clear decision framework for RAP vs IBR, emphasizing that switching from IBR to RAP is a one-way door (cannot return to IBR). Borrowers with PSLF goals should stay on IBR if eligible, as RAP's 30-year forgiveness is taxable. The article also warns of a $50 glitch in the RAP payment formula. Another article details strategies to lower AGI (pre-tax 401k, HSA, IRA) to reduce IDR payments, which is especially useful for borrowers in the 90-day window. ED is revising the PSLF form (emergency approval requested); borrowers should keep records organized. **Critical new warning: New borrowers who do not actively choose a plan will default into Tiered Standard, which gives zero PSLF credit. This quietly blocks public service workers from forgiveness. Parent PLUS borrowers after July 1 lose IDR access entirely, killing their PSLF path. Borrowers must actively select RAP for PSLF credit.** A Dartmouth article highlights the elimination of Graduate PLUS and the shift to private loans for graduate students, reinforcing the need for careful planning. A new article reinforces the PSLF trap and provides concrete steps for public service workers to avoid losing progress. **Latest practical guide (10 things before Sept. 30):** Includes concrete numbers (e.g., $25/month interest savings on $40k with autopay), reinforces the new loan trap, and emphasizes the September 30 deadline for autopay discount and plan switching. Borrowers should use the checklist to avoid default and PSLF loss. **New updates:** Senate Parliamentarian blocked GOP repeal of IDR plans via Byrd Rule, buying time but not changing the overhaul. Nelnet FAQ reveals ED compressed SAVE exit timeline by 3 months, meaning all borrowers' 90-day clocks start by end of 2026 — tighter deadlines. A new article highlights the impact on psychology graduate students, warning that reduced repayment options and higher costs could shrink the mental health workforce. Default surge numbers (9.5M, $233B) confirm the crisis; geographic and demographic disparities underscore urgency.