What Every Student Loan Borrower Needs to Know Right Now Published May 2026 | Dare to Dream Credit Consulting | Ruth Hubert Finance Coach If you have federal student loans, 2026 is a year you cannot afford to ignore. Major changes are happening right now — and what you do not know could cost you. The SAVE Plan Is Over The Department of Education has officially ended the SAVE Plan and is directing the 7.5 million borrowers enrolled in it to exit and select a new legal repayment plan. Borrowers have 90 days after July 1, 2026, to make that switch. If you are currently on SAVE, do not wait — contact your loan servicer now. The Virtual Savvy A New Repayment Plan Is Coming A new income-driven option called the Repayment Assistance Plan, or RAP, launches July 1, 2026. Under RAP, monthly payments are based on your income and number of dependents, and borrowers who make full, on-time payments are protected from runaway interest accumulation. The Virtual Savvy Forgiveness May Now Come With a Tax Bill If your federal student loans are forgiven under an income-driven repayment plan in 2026 or later, the forgiven amount is generally treated as taxable income. That means you could receive a Form 1099-C and owe taxes on the forgiven balance. The only exception is Public Service Loan Forgiveness — forgiveness under PSLF is not considered taxable income. MyOutDesk The Virtual Savvy A New Bill Could Help Laid-Off Borrowers A new House proposal would allow borrowers who lose their jobs to receive forgiveness credit during unemployment deferment — even when no payment is made. Under current rules, time spent in unemployment deferral does not count toward forgiveness progress. This bill is still being considered, but worth watching closely. Wishup What You Should Do Right Now Check your current repayment plan at StudentAid.gov. If you are on SAVE, start exploring your options immediately. And if you have questions about how these changes affect your financial future, that is exactly what we are here for. Book a consultation with Dare to Dream Credit today. Disclaimer: This content is for educational purposes only and does not constitute legal or financial advice.