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01 Loan payments

New Federal Student Loan Repayment Plan? What to Know

Calculator No. 01-4095 · Updated · Formula and assumptions shown below

Monthly payment $405.53
Total interest
$4,331.80
= Monthly payment × loan term × 12 − loan amount
Loan amount
$20,000
Input
Interest rate (APR)
8 %
Input
You enter
Loan amount ($), Interest rate (APR) (%), Loan term (years)
You get
Monthly payment ($), Total interest ($)
Rounding
2 dp

Estimate for education, not financial advice. The result follows from the numbers you enter and the formula shown. It is not a quote or an offer, and it does not include fees, taxes or insurance unless the calculator asks for them. Ask your lender for the exact figures.

A new federal student loan repayment plan may refer to the Repayment Assistance Plan (RAP), created by federal legislation in 2025, rather than a calculator-based payment estimate. This general loan calculator estimates a fixed-rate monthly payment and total interest from the balance, APR, and term you enter; it cannot determine your RAP payment or establish which federal repayment plans are currently available.

Formula

The calculator applies the standard fixed-rate, fully amortizing loan formula. It first calculates a level monthly payment, rounded to cents, then subtracts the original principal from the sum of all scheduled payments to estimate total interest.

  • p = loan principal, in dollars.
  • apr = annual percentage rate entered as a percentage, such as 8 for 8%.
  • r = monthly rate, calculated as apr ÷ 1,200.
  • n = number of monthly payments, calculated as years × 12.
  • pmt = monthly payment in dollars: round[p × r ÷ (1 − (1 + r)−n), 2].
  • int = estimated total interest in dollars: pmt × n − p.

It models a single balance with the same interest rate and payment each month. Federal student loan repayment calculations can instead depend on plan rules, income, family circumstances, loan type, and later policy changes. Those factors are not inputs here.

Worked Example

Using the calculator’s default values—$20,000 principal, 8% APR, and a five-year term—first convert the APR and term:

  • Monthly rate: 8 ÷ 1,200 = 0.0066667.
  • Number of payments: 5 × 12 = 60.
  • Monthly payment before rounding: $20,000 × 0.0066667 ÷ [1 − (1.0066667)−60] ≈ $405.53.
  • Monthly payment rounded to cents: $405.53.
  • Total scheduled payments: $405.53 × 60 = $24,331.80.
  • Estimated total interest: $24,331.80 − $20,000 = $4,331.80.

The calculation rounds the payment before multiplying by the number of months. That convention means the displayed total follows the payment shown, though a real final payment can differ because of daily interest, payment dates, and servicing adjustments.

Assumptions

  • The interest rate is fixed for the entire term.
  • Payments are equal monthly payments, made at the end of each monthly period.
  • Interest compounds monthly at APR ÷ 12.
  • Fees, taxes, insurance, penalties, deferment, forbearance, missed payments, and extra payments are not included.
  • Federal program rules, income-based payment changes, and loan forgiveness are not modelled.

What the New Federal Plan Means

RAP is the name associated with a new federal student loan repayment option established by the One Big Beautiful Bill Act, signed in July 2025. Its policy details and implementation are separate from ordinary fixed-payment arithmetic. A calculator that asks only for principal, APR, and term cannot reproduce an income-driven amount, determine eligibility, or establish the effect of the law on a particular borrower.

Federal repayment options can change through legislation, agency implementation, court decisions, and updates to official guidance. The phrase “new repayment plan” also appears in older coverage of the SAVE plan, which is distinct from RAP. Do not assume that an article about a plan’s announcement describes the options available to enroll in now. Check current information from the Department of Education and your loan servicer, and confirm whether a quoted payment applies to your specific loans.

How to Use This Estimate

  1. Enter the balance you want to model. For multiple loans, a combined estimate is meaningful only if the loans share the same rate and repayment term.
  2. Enter the APR as a percentage, not a decimal. For example, enter 6.5 for 6.5%.
  3. Enter the repayment term in years. The calculator converts it to months; it does not infer a term from a federal repayment plan.
  4. Compare the resulting payment and total interest with figures from an official repayment estimate, checking that the balance, rate, and period match.

For example, a $20,000 balance at the default 8% APR over five years produces the estimate shown above. Changing the term while holding the other inputs constant changes both payment size and the number of payments. This is an arithmetic comparison, not a statement about what a federal plan will charge.

Limits and Common Misunderstandings

A payment shown here is not a federal student loan bill. Income-driven plans generally use program-specific calculations rather than the fixed-payment formula on this page. A payment under a plan may be affected by inputs absent from this calculator, and actual interest treatment may not match monthly compounding at a constant APR.

  • APR is not a payment amount. It is entered as a yearly percentage; the formula converts it to a monthly rate.
  • Term means months of payments after conversion. Five years is 60 monthly payments, not five payments.
  • Total interest is an estimate. It assumes every payment arrives on schedule and that the rate and balance follow the model.
  • Consolidation or refinancing is not evaluated. The calculator does not determine eligibility, program status, or the consequences of changing loan arrangements.

For an official plan comparison, verify the latest rules and enrollment status with the Department of Education or your servicer. Ask how the estimate treats each loan, the applicable interest, payment start date, and any plan-specific conditions.

Frequently Asked Questions

What is the new federal student loan repayment plan?
RAP, or the Repayment Assistance Plan, is a new federal option established in 2025 legislation. The calculator on this page does not calculate RAP payments; consult current federal guidance or your servicer for applicable details.

Is RAP the same as SAVE?
No. They are different plan names. Coverage about SAVE may refer to earlier developments, so check the date and current official guidance before relying on it to understand available options.

Can this calculator tell me my federal student loan payment?
No. It estimates a level monthly payment for a fixed-rate loan. It does not apply federal plan formulas, income information, eligibility rules, or forgiveness provisions.

Does a longer term lower total interest?
Not necessarily. In this fixed-rate model, extending the term generally lowers the monthly payment but increases the number of payments and total interest. Actual federal plan outcomes can differ.

Where can I check which plan applies to my loans?
Use current information from the U.S. Department of Education and contact your servicer to confirm loan-specific details and available repayment options.

This result is an estimate for education; the lender’s disclosure gives the exact figures.

Related

Formula used
in p | Loan amount | $ | 20000 | 1 | 100000000
in apr | Interest rate (APR) | % | 8 | 0.01 | 100
in yrs | Loan term | years | 5 | 0.0833 | 50
out pmt | Monthly payment | $ | round(p * (apr / 1200) / (1 - (1 + apr / 1200) ^ -(yrs * 12)), 2) | 2
out int | Total interest | $ | pmt * yrs * 12 - p | 2

Each line is one input (in, sel, list) or one result (out: label, unit, formula, decimals). How the calculators work

Method: the standard loan formula for this calculation, fixed rate and monthly compounding unless stated, rounded as each result states. Not financial advice; no lender, rate or product is recommended. See formulas and assumptions, the disclaimer or report an error.

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