Repayment Assistance Plan (RAP) for Veterinarians: The 2026 Guide

The SAVE plan was vacated by federal courts in 2024 and officially wound down in 2026. RAP replaced it as the federal government's income-driven repayment option for new loans — and it comes with rules that differ meaningfully from what SAVE or IBR borrowers are used to. For DVMs borrowing after July 2026, RAP is the only IDR option. For existing IBR borrowers considering a switch, there's a one-way door to understand before moving.

What Happened to SAVE — and What RAP Is

SAVE (Saving on a Valuable Education) launched in 2023 as the Biden administration's replacement for REPAYE. Federal courts enjoined it in 2024, placing roughly 7.4 million borrowers in administrative forbearance. SAVE was officially replaced effective July 1, 2026, when the Repayment Assistance Plan launched under the One Big Beautiful Bill Act.¹

For DVMs, this matters in two distinct ways:

• New borrowers (loans after July 1, 2026): RAP is the only income-driven repayment option. IBR, PAYE, and ICR are not available for loans first disbursed after that date.
• Existing borrowers on IBR or PAYE: Those plans remain available — you are not forced onto RAP. But you can choose to switch, with important caveats described below.

How RAP Payments Are Calculated

RAP uses a tiered rate tied to adjusted gross income (AGI). The rate rises 1 percentage point per $10,000 of income, from a floor around 1%–2% up to a hard cap of 10%. The approximate formula:²

Rate = min(10, floor(AGI ÷ $10,000) + 1) %
Monthly payment = AGI × Rate ÷ 12

Two adjustments apply: each dependent you claim reduces your monthly payment by $50, and no payment ever drops below $10/month regardless of income.

*IBR for post-July 2014 borrowers: (AGI − $23,940) × 10% ÷ 12 using 2026 150% FPL of $23,940 for single filers. IBR payments shown for comparison — IBR is not available for new loans after July 1, 2026.

Key takeaway from the table: IBR produces lower monthly payments than RAP across every typical DVM income level. If you already have IBR eligibility, you're generally paying less under IBR. RAP is still valuable because (a) it's the only IDR option for new loans, and (b) it includes an interest subsidy that IBR does not.

The Interest Subsidy: Why It Matters for Heavily-Indebted DVMs

RAP includes an interest subsidy similar to what SAVE had: if your required monthly payment is less than the interest accruing that month, the federal government covers the gap. Your loan balance cannot grow while you make required RAP payments.³

This matters most in the early career years when income is low relative to a large loan balance. A DVM with $210,000 in loans at 7.94% accrues roughly $1,390/month in interest at graduation. An IBR payment of $176/month (at $45K resident income) covers only 13% of that interest — under pre-SAVE IBR, the balance would grow by $1,214/month. Under RAP, the government absorbs that shortfall.

IBR does not currently have a comparable subsidy for the full interest gap (SAVE's subsidy was a key differentiator that IBR lacks). For DVMs with high debt-to-income ratios — which describes most new graduates — this is the primary practical advantage RAP has over IBR.

PSLF and RAP: Yes, It Works

Public Service Loan Forgiveness is unaffected by which qualifying repayment plan you use. RAP is a qualifying plan for PSLF, and payments made under RAP while employed full-time at a qualifying employer count toward the 120 qualifying payment requirement.⁴

Two important distinctions:

• PSLF forgiveness remains tax-free under IRC § 108(f)(1), regardless of which qualifying plan you were on.
• RAP's 30-year IDR forgiveness is taxable. The American Rescue Plan Act's exemption for IDR forgiveness expired December 31, 2025. If you pursue RAP's 30-year forgiveness outside of PSLF, the forgiven amount is ordinary income in the year of forgiveness — creating a large tax event most DVMs want to avoid.

For PSLF-eligible DVMs (USDA, academic hospitals, non-profit shelters), the plan choice matters less because the PSLF exit is tax-free either way. The primary reason PSLF-track DVMs choose IBR over RAP is lower monthly payments — which reduces total out-of-pocket cost over 10 years.

The One-Way Door: Switching Between RAP and IBR

This is the most consequential rule for existing borrowers to understand, and the one the VIN Foundation characterized as a "major unexpected change" when RAP's final rules were published May 1, 2026:⁵

• IBR → RAP: Your IBR payment months count toward RAP's 30-year forgiveness clock.
• RAP → IBR: Your RAP payment months do not count toward IBR's 20-year forgiveness clock.

In other words: switching from IBR to RAP is permitted, and your prior IBR history transfers to the RAP forgiveness timeline. But if you want to switch back to IBR, those RAP months are lost for IBR purposes. The IBR forgiveness clock restarts from when you re-enroll in IBR.

The practical rule for existing IBR borrowers: don't switch to RAP unless you understand exactly why you're doing it and have modeled the full timeline. For PSLF-track borrowers the switch is lower stakes (PSLF exits are the same regardless of plan), but for non-PSLF borrowers pursuing 20-year forgiveness it can be catastrophic.

Warning for the Class of 2026: Do Not Consolidate

The VIN Foundation issued a specific urgent warning for the graduating class of 2026: consolidating your federal loans after July 1, 2026 creates a new loan origination date, making the consolidated loan subject to RAP-only rules and eliminating IBR eligibility for that balance.⁵

If you graduated in May or June 2026 and your loans were first disbursed before July 1, 2026, you retain IBR eligibility — but only as long as you don't consolidate those loans after July 1, 2026. Consolidation would surrender that eligibility permanently for the new consolidated loan.

Who does need to consolidate: DVMs with older FFEL loans who want PSLF eligibility should still consolidate into Direct Loans — but they should have done this before July 1, 2026, to preserve their options. If you missed that window, get advice from a student loan specialist before taking action.

Strategy by Career Stage

Class of 2027 and Later: RAP Is Your Baseline

With loans disbursed after July 1, 2026, RAP is your only income-driven option. The good news: the interest subsidy prevents your balance from growing during low-payment years (residency, early associate), and RAP qualifies for PSLF if you're headed toward a qualifying employer. The consideration is the 30-year forgiveness timeline with a taxable end — which makes refinancing relatively more attractive for private-practice DVMs who won't pursue PSLF.

One strategic path for non-PSLF-eligible new grads: use RAP for the first 2–3 years to benefit from the interest subsidy and low payments, then refinance to a private loan once income is high enough to service aggressive repayment. Use the Vet Student Loan Calculator to model breakeven points.

PSLF-Eligible DVMs (USDA, Teaching Hospitals, Non-Profits): Likely Stay on IBR

If you're already on IBR and pursuing PSLF, the strongest reason to switch to RAP is the interest subsidy — but you're likely paying off the balance with PSLF forgiveness in under 10 years anyway. IBR payments are lower than RAP payments at most vet income levels. Unless you have specific reasons to want RAP's subsidy, staying on IBR and making PSLF-qualifying payments is probably optimal.

Existing SAVE Forbearance Borrowers: Enroll in IBR Now

If you were in SAVE administrative forbearance and your loans predated July 1, 2026, you have a choice: IBR or RAP. For most DVMs with PSLF eligibility, IBR is the cleaner option — lower payments, established qualifying payment track record with MOHELA. Verify your qualifying payment count with MOHELA before re-enrolling to make sure any forbearance months were properly credited.

Mid-Career Private Practice Owner: Model the Refi Math

A practice owner generating $250K+ in income has an IBR payment of $1,880+/month ($250K − $23,940 × 10% ÷ 12 = $1,881). At that payment level, the loan is paying down quickly and there's no forgiveness math to pursue. Refinancing to a private loan at 5.5–7.0% and paying aggressively for 5–7 years is almost always better than remaining on any IDR plan at these income levels. See Vet School Loan Refinancing for the decision framework.

RAP vs IBR: Side-by-Side

Action Steps for DVMs

1. Identify your loan origination dates at studentaid.gov. Loans first disbursed on or after July 1, 2026, are RAP-only for IDR purposes. Earlier loans retain IBR eligibility.
2. If you were in SAVE forbearance: Enroll in IBR promptly (if your loans predated July 1, 2026) and verify with MOHELA whether any forbearance months count as qualifying PSLF payments. Don't assume.
3. Class of 2026 grads with loans before July 2026: Do not consolidate without specific advice from a student loan specialist. Consolidation creates new loan dates and eliminates IBR eligibility for that balance.
4. Before switching from IBR to RAP: Model the full timeline. If you're not PSLF-eligible and are pursuing 20-year IBR forgiveness, switching to RAP is a one-way door that extends your timeline by a decade.
5. Private practice DVMs above $150K income: Run a refinancing comparison. At high income, IBR and RAP both produce large monthly payments; refinancing and aggressively paying off in 5–7 years may cost less in total interest with no forgiveness complexity.
6. Use the calculator: Model your specific balance, interest rate, and income trajectory in the Vet Student Loan Calculator.