RAP and IBR are both income-driven plans, but they compute payments very differently. Here is how to tell which is cheaper for you in 2026.
The core difference
| Feature | RAP | IBR (new) |
|---|---|---|
| Payment basis | % of total AGI (1-10%) | 10% of discretionary income |
| Poverty-line deduction | None | 150% of HHS guideline |
| Per-dependent reduction | $50/month each | Via family-size in poverty guideline |
| Payment cap | None | 10-year Standard amount |
| Unpaid interest | Waived | Not waived (can capitalize) |
| Forgiveness | 360 payments / 30 yr | 240 payments / 20 yr |
| New borrowers (post-July 2026) | Yes | No |
Source: Federal Student Aid and the OBBBA fact sheet, as of June 2026.
Why IBR often wins at lower incomes
IBR subtracts 150% of the poverty guideline (about $23,475 for a single filer in 2025) before charging 10%. RAP charges a percentage of your whole AGI. So at modest incomes - especially with a larger family, which raises the IBR deduction - IBR frequently produces the lower payment.
Why RAP can still be the better deal
RAP’s percentage tops out at 10% and it waives unpaid interest plus matches up to $50/month of principal, so your balance actually falls. IBR has no general interest waiver, so a low payment can leave the balance growing. If you are a new borrower, RAP is your only income-driven option anyway.
How to decide
Use the plan comparison calculator with your AGI, balance and family size. Also read how RAP works and how IBR works, and our guide to income-driven vs Standard repayment.
General information, not financial or legal advice. Rules are changing in 2025-2026 - verify with your servicer and studentaid.gov.