The Repayment Assistance Plan (RAP), which became available on July 1, is designed to help student loan borrowers manage their payments based on income, capping monthly payments between 1% and 10% of earnings.
However, experts like Mark Kantrowitz emphasize that being even one day late on a payment can result in losing critical benefits, such as an interest waiver and a matching principal payment of up to $50. These protections are intended to prevent borrowers' balances from increasing due to interest accrual. Nearly 46,000 borrowers have already applied for RAP, highlighting its appeal.
Additionally, borrowers can benefit from a 1-percentage-point interest rate reduction by enrolling in automatic payments by the end of September 2026. However, caution is advised as some borrowers have experienced incorrect deductions with autopay.
To avoid missed payments, borrowers should monitor their accounts closely and inform their loan servicer of any income changes to adjust payments accordingly