Stay on Track for PSLF: What the July 1 OBBBA Changes Mean for You

New federal loan rules starting July 1, 2026, could impact your path to PSLF.

If you’re working toward Public Service Loan Forgiveness (PSLF), there’s a big date you should know: July 1, 2026. That’s when a new set of federal student loan rules kicks in, and depending on the types of loans you have, these changes could affect your path to forgiveness.

Here’s what’s happening and what it means for you.

PSLF Still Exists & Borrowers are Actively Receiving Forgiveness

PSLF remains fully intact. You can still earn forgiveness by working 30+ hours/week at a qualifying nonprofit, government, or tribal employer AND making 120 qualifying payments on federal Direct Loans under an income‑driven repayment (IDR) plan.

Critical PSLF Changes Looming for Parent PLUS borrowers

• If you have Parent PLUS loans, you’ll need to apply for a Direct Consolidation Loan by April 1, 2026 to make your loans eligible for an IDR plan, a requirement for PSLF.

• If you apply to consolidate after this date, your consolidation loan may not be disbursed by the July 1 deadline, which would make your loans ineligible for any IDR plans and the PSLF program.

• Note for parents of current students: If you take out any new Parent PLUS loans after July 1, 2026, you’ll lose IDR and PSLF eligibility for all your loans — even the ones that were previously eligible. You will need to repay all of your loans on the new Standard Repayment Plan.

Income-Driven Repayment Plan Changes For Borrowers

The repayment plan you’re on matters — especially as older plans phase out and new ones take their place.

Existing borrowers (no new loans after 7/1/2026)

• If you’re repaying your loans under the Income-Based Repayment (IBR) plan, you can stay on this plan, as IBR remains an eligible plan for PSLF.
• If you’re enrolled in Pay As You Earn (PAYE) or Income-Contingent Repayment (ICR), you can continue to make PSLF-qualifying payments on these plans for now, but MUST switch to (IBR) or the new Repayment Assistance Plan (RAP) by 7/1/2028.
• Borrowers on the SAVE plan are not making progress toward PSLF, and will need to switch to one of the plans above to resume PSLF progress.

If you borrow new federal loans or consolidate existing loans after 7/1/2026

• The only PSLF-qualifying repayment plan you’ll be able to access is the new Repayment Assistance Plan (RAP). All loans must be paid under the same repayment plan.
• The RAP plan doesn’t have a payment cap, which means payments on RAP could be much higher compared to IBR, especially for households with higher incomes.
• If you’re counting on loan forgiveness under PSLF, carefully consider how borrowing new loans will impact your future payments.

Now’s the Time To Take Action

Every borrower’s situation is unique. Your loan types, repayment plan, employment, and even whether you’re considering borrowing more loans can all change how these rules apply to you.

If you have Tuition.io: our student loan coaches are available to help you choose the best repayment plan and navigate the process. Log in to Tuition.io to schedule a 1:1 with a coach.

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