As of July 1, 2026, approximately 7 million student loan borrowers are facing a significant shift in their repayment plans. The SAVE plan is being phased out, and borrowers must choose a new repayment plan within 90 days of notification. This transition has sparked concern among many, but there are crucial details that borrowers might be overlooking.
An analysis of data from the Education Department and the Government Accountability Office (GAO) reveals that at least 3 million of these borrowers could still qualify for a $0 monthly payment under the Income-Based Repayment (IBR) plan. This option has been a staple of income-driven repayment (IDR) for over a decade and has consistently benefited a large share of enrollees.
Historical Context of $0 Monthly Payments
The concept of $0 monthly payments is not new to the SAVE plan. It has been a feature of IDR plans for years, providing relief to borrowers with low incomes. Before the pandemic, roughly 8.2 million borrowers were enrolled in IDR plans, with nearly half of them having a $0 scheduled payment. The GAO reported similar patterns within the REPAYE plan, where more than half of borrowers owed nothing due to low reported income.
The SAVE plan further expanded this benefit. By using a 225% discretionary income formula, nearly 60% of SAVE borrowers with scheduled payments had a $0 monthly payment as of early 2026. The Education Department later reported that 4.6 million of the more than 8 million borrowers enrolled in SAVE had a $0 monthly payment.
Estimating Eligibility for $0 Payments in 2026
To estimate how many borrowers might still qualify for $0 payments under IBR, we used conservative assumptions based on historical data. Here’s the breakdown:
- Total SAVE Borrowers Approximately 7.7 million borrowers were enrolled in SAVE or SAVE forbearance and must move to a new plan.
- SAVE Borrowers with $0 Payments GAO data shows that 58% of SAVE borrowers had $0 payments as of early 2026.
- IBR’s 150% Threshold IBR is less generous than SAVE, with a $0 cutoff at $23,940 in adjusted gross income for a single borrower in 2026.
- Income Growth Adjustment Most SAVE borrowers last certified their income in 2026 or earlier, and wages have grown since. We assumed the $0 share would fall to 40-45% to be conservative.
- Final Estimate Using these assumptions, 3.1 to 3.5 million borrowers would likely qualify for a $0 payment on IBR.
It’s important to note that this is an estimate, not an official figure from the Education Department. Additionally, this estimate only applies to borrowers who choose IBR. Those who opt for the new Repayment Assistance Plan (RAP) or a standard plan will always have an above $0 payment.
The Importance of Choosing the Right Plan
The choice of repayment plan in the next 90 days is crucial because the new Repayment Assistance Plan (RAP) which opened on July 1, 2026, differs significantly from previous IDR designs. Unlike older plans, RAP has no $0 payment option. Borrowers with an adjusted gross income of $10,000 or less must pay a $10 monthly minimum, and payments scale from 1% to 10% of total AGI as income rises.
While RAP offers benefits like an interest subsidy and a principal match of up to $50 per month, it means that the lowest-income borrowers will now have to make some payment every month. In contrast, IBR retains the $0 payment option, making it a more attractive choice for those with low incomes.
Borrowers can also consider PAYE or ICR temporarily, but these plans will sunset by July 1, 2028, requiring another switch later.
For families preparing for a new bill, the practical advice is straightforward: calculate before you panic. Using tools like the College Investor’s Student Loan Calculator can help determine the best repayment option based on income, family size, and other factors.
The worst outcome is doing nothing. Borrowers who miss the 90-day window will be placed in a plan they didn’t choose, and those who simply stop paying face delinquency, credit damage, and potential wage garnishment or tax refund offsets.
