Federal student loan repayment is entering a new period of change. The Ministry of Education stops ICR and PAYE before June 30, 2028. To make that possible, registration is expected to close earlier (likely late 2027 or early 2028 according to sources) so that borrowers cannot wait until the last minute to sign up.
For the roughly 2.5 million borrowers enrolled in these plans, it’s important to know that the plans won’t disappear overnight. Payments can continue until the deadline. But the bigger risk is waiting too long to understand what comes next.
What the phasing out of ICR and PAYE means
ICR and PAYE are being phased out due to the One Big Beautiful Bill Act, which attempted to simplify student loan repayment.
The 2028 end date means two things at once:
- Once registration closes, new borrowers will no longer be able to enter ICR or PAYE.
- Borrowers currently using these plans will need to migrate to IBR or RAP.
Although the statutory end date is June 30, 2028, it is widely expected that the Department for Education will stop accepting new ICR and PAYE applications months earlier. The reason is operational: loan servicers need time to process applications, update systems and move borrowers to other repayment plans.
From a borrower’s perspective, this means June 2028 isn’t the exact deadline you can rely on. And anyone hoping to get into PAYE or ICR needs to do so now, otherwise it becomes a moot point.
Options if you are currently enrolled in ICR or PAYE
Borrowers already enrolled in PAYE or ICR can continue to make payments under these plans for the time being. Monthly payments, interest accrual, and progress toward loan forgiveness don’t suddenly end.
The safest approach is to consider the remaining years as a planning window. Now it’s time to plan.
Important variables to compare in the future include:
- Monthly payment size at current and future income levels
- Total amount paid before any forgiveness
- Forgiveness timeline and any remaining taxable balance
The key is to look at the difference between IBR and RAP for your situation.
The point is not to switch immediately, but to understand the trade-offs.
Special rules for borrowers of parent PLUS loans
Parent PLUS borrowers face a more limited set of choices. Even borrowers who used a double consolidation to access income-driven repayments not qualify for RAP.
For this group IBR is the only remaining income-driven option once ICR undergoes. And this only applies to existing Parent PLUS borrowers, not future borrowers.
This reality makes early planning even more important. Parent borrowers must:
- Confirm your eligibility for IBR based on loan type and consolidation history
- Estimate payments at current income and at retirement
- Understand the timelines of forgiveness and how they interact with family finances
Because parent PLUS balances are often larger and tied to later-career borrowers, these changes can have real impacts on household budgets.
The bottom line
The end of ICR and PAYE is coming. Borrowers who use these plans have time to prepare, but that time is finite.
Understanding how IBR and RAP relate can make a policy change a manageable transition rather than a financial surprise.
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