The Education Department quietly updated its online guidance this summer to reflect that a key student loan forgiveness benefit will not be available for the newest repayment plans that launched in July. The updates are a blow for borrowers, and particularly those who take out new federal student loans going forward, as they may now be cut off from the benefit entirely.

The update centers on PSLF Buyback, a program related to Public Service Loan Forgiveness. PSLF allows borrowers to discharge their federal student loans in as little as 10 years if they work in certain full-time public service careers while making qualifying payments on their loans. PSLF Buyback is a related program that gives borrowers a safe harbor to “buy back” PSLF credit for nonpayment periods that didn’t count toward loan forgiveness, particularly certain deferment or forbearance periods.

But under the Education Department’s new guidance, borrowers enrolled in either the Repayment Assistance Plan (or RAP) or the new Tiered Standard Repayment plan will not be eligible for PSLF Buyback for periods in which they are in one of those plans. That may severely limit access to this student loan forgiveness benefit going forward.

Buyback Opportunity Is Important New Student Loan Forgiveness Benefit For PSLF

The PSLF Buyback program is a relatively new option that was enacted under updated regulations in 2023. The program is designed to give borrowers a fallback option if they wind up working in qualifying, full-time public service employment for the required 10-year (or 120-month) period, but have gaps in qualifying payments due to certain deferment and forbearance periods. A prime recent example is the involuntary SAVE plan forbearance , as millions of student loan borrowers were forced into an administrative forbearance for two years or longer due to legal challenges and associated court orders.

Borrowers can apply to “buy back” these deferment or forbearance periods by submitting a PSLF Buyback application. While not all deferment or forbearance periods are eligible, the option can provide an important safety net for borrowers pursuing student loan forgiveness. If they are approved, they would make a lump-sum payment equivalent to what they would have paid under an income-driven repayment plan during the periods of non-payment.

“You must make an extra payment of at least as much as what you would have made under an income-driven repayment (IDR) plan during the months you’re trying to buy back,” explains the Education Department in its online guidance for PSLF Buyback. “The amount required will be based on your income and family size at the time of the deferment or forbearance, not your current income and family size.”

There are some important rules and restrictions for the program. In particular, the periods being bought back, if approved, must allow the borrower to qualify for student loan forgiveness by reaching their 120th qualifying payment under PSLF.

“You are eligible for this opportunity only if you already have 120 months of qualifying employment,” says the department in its guidance. “Certified qualifying employment that includes the months of deferment or forbearance you intend to buy back. If you’ve consolidated your loans, you can buy back months only on the current consolidation loan. You can’t buy back months from the loans included in the consolidation loan or for any period prior to the first disbursement date of a consolidation loan.”

New Student Loan Repayment Plans Are Excluded From PSLF Buyback

Prior to the July 1 regulatory changes the Education Department put into place to implement the One Big, Beautiful Bill Act, there were no specific repayment plan restrictions on PSLF Buyback eligibility. In other words, it didn’t matter what repayment plan the borrower was in. As long as they had months that were eligible for PSLF Buyback, and they complied with all of the other program rules, they could apply for student loan forgiveness under the program.

But that is no longer the case. In updates posted this summer, the Education Department is now stating that borrowers cannot buyback periods during which they were enrolled in either the Repayment Assistance Plan (or RAP) or the Tiered Standard Repayment plan, two new repayment options that were created under the One Big, Beautiful Bill Act and launched in July.

“You’re not eligible for PSLF buyback if any of the following are true,” says updated department guidance. “You do not have at least 120 months of qualifying employment already certified. You only have outstanding Federal Family Education Loan (FFEL) Program loans, outstanding Perkins Loans, or other outstanding non-Direct Loans. All your loans are paid-in-full, forgiven, discharged, or included in a consolidation loan. You were enrolled in either the Repayment Assistance Plan or the Tiered Standard Plan during the month(s) you want to buy back.”

That means that borrowers who enroll their student loans in either RAP or the Tiered Standard Repayment plan, and subsequently enter a deferment or forbearance while in one of those plans, will not be able to apply for PSLF Buyback for those periods. Notably, while the Tiered Standard Repayment plan is not an eligible plan for PSLF, RAP is. So the new restriction closes off an important pathway for student loan borrowers who choose to enroll in an otherwise-eligible repayment plan.

Rule Change Means New Student Loan Borrowers Are Effectively Ineligible For PSLF Buyback

Notably, separate rules that went into effect on July 1 mandate that RAP is the only PSLF-eligible repayment plan for borrowers who take out new federal student loans, or consolidate their existing loans , on or after July 1 of this year. That’s because the One Big, Beautiful Bill Act mandates that any borrower who has a new federal student loan disbursement going forward is treated as a “new borrower,” and will only have access to RAP or the Tiered Standard Repayment plan.

“If you have at least one loan first disbursed on or after July 1, 2026, you’re required to repay all of your eligible Direct Loans, including loans first disbursed before July 1, 2026, under either the Repayment Assistance Plan (RAP) or the Tiered Standard Plan,” explains the Education Department in separate online guidance covering the July 1 rule changes.

Parent PLUS borrowers are even more restricted in their repayment plan options .

“If you have parent PLUS loans or a Direct Consolidation Loan that includes a parent PLUS loan, then you’re permitted to repay those loans only under the Tiered Standard Plan.”

This effectively means two things. First, legacy borrowers pursuing PSLF who take out new federal student loans (or consolidate their existing loans) going forward will be limited to RAP, and therefore will not be able to apply for PSLF Buyback for any future deferment or forbearance periods (although periods prior to their enrollment in RAP, including the SAVE plan forbearance period, should still be eligible, provided the borrower complies with all other rules governing the program). But purely new student loan borrowers who don’t have an existing balance are now essentially cut off entirely from PSLF Buyback, as their only repayment options are RAP and the Tiered Standard Repayment plan. RAP is the only one of those plans eligible for student loan forgiveness through PSLF, but under the Education Department’s new rule changes, it is not eligible for PSLF Buyback.