Key Points
- Income-Contingent Repayment (ICR) and Pay As You Earn (PAYE) officially end on June 30, 2028, with enrollment expected to stop earlier to allow time for transitions.
- Borrowers already in ICR or PAYE can keep paying under those plans, but should compare outcomes under Income-Based Repayment (IBR) and the Repayment Assistance Plan (RAP) to avoid future surprises.
- Parent PLUS borrowers, including those who used a double consolidation, cannot use RAP and will need to evaluate IBR as their long-term option.
Federal student loan repayment is entering another period of change. The Department of Education is ending ICR and PAYE by June 30, 2028. To make that possible, enrollment is expected to close earlier (likely in late 2027 or early 2028 according to sources) so borrowers cannot wait until the last minute to apply.
For the roughly 2.5 million borrowers enrolled in these plans, it's important to know that the plans do not disappear overnight. Payments can continue until the deadline. But the bigger risk is waiting too long to understand what comes next.
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What The ICR and PAYE Phase-Out Means
ICR and PAYE are being phased out due to the One Big Beautiful Bill Act, which was attempting to simplify student loan repayment.
The 2028 end date means two things at once:
- No new borrowers will be able to enter ICR or PAYE once enrollment closes.
- Borrowers currently using those plans will need to migrate to IBR or RAP.
Although the statutory end date is June 30, 2028, the Department of Education is widely expected to stop accepting new ICR and PAYE applications months earlier. The reason is operational: loan servicers need time to process applications, update systems, and guide borrowers into other repayment plans.
From a borrower’s perspective, this means June 2028 is not the exact deadline to rely on. And anyone hoping to enter PAYE or ICR should do so now, otherwise it becomes moot.
Options If You're Currently Enrolled In ICR or PAYE
Borrowers already enrolled in PAYE or ICR can continue making payments under those plans for now. Monthly payments, interest accrual, and progress towards loan forgiveness do not suddenly stop.
The safest approach is to treat the remaining years as a planning window. Now's the time to plan.
Key variables to compare moving forward include:
- Monthly payment size at current and future income levels
- Total amount paid before any potential 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 Parent PLUS Loan Borrowers
Parent PLUS borrowers face a more limited set of choices. Even borrowers who used a double consolidation to gain access to income-driven repayment will not be eligible for RAP.
For this group, IBR is the only remaining income-driven option once ICR sunsets. And this is only for existing Parent PLUS borrowers, not future borrowers.
That reality makes early planning even more important. Parent borrowers should:
- Confirm eligibility for IBR based on loan type and consolidation history
- Estimate payments at current income and near retirement
- Understand forgiveness timelines 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 consequences for 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 compare can turn a policy change into a manageable transition rather than a financial surprise.
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Editor: Colin Graves
Robert Farrington is the founder of The College Investor and is widely recognized as one of the nation’s leading voices on student loan debt and saving for college. He holds an MBA from UC San Diego Rady School of Management and has spent over 15 years researching, writing, and advising on student loans, 529 plans, financial aid programs, and saving and investing for young professionals.
Robert has been featured in the The New York Times, The Wall Street Journal, The Washington Post, NBC News, and Forbes, where he has been a regular personal finance contributor for over a decade. His work combines both professional expertise and personal experience – he successfully navigated his own student loan repayment journey and has helped thousands of readers do the same.
He is committed to making the intersection of personal finance and education transparent and accessible. You can learn more about Robert on the About Page or on his personal site RobertFarrington.com.