A teacher who spent two years in an ineligible forbearance while the SAVE Plan worked its way through federal court assumed she could eventually buy back that time toward Public Service Loan Forgiveness. New Department of Education guidance says she can no longer count on that if she enrolls in either of the two newest repayment plans. The department has closed the PSLF Buyback Program to any borrower who signs up for the Repayment Assistance Plan or the Tiered Standard Plan, the two options that became the default for federal student loan borrowers this summer.
What the Buyback Program Was Built to Fix
The PSLF Buyback Program exists for a narrow but important group: federal borrowers who already have the equivalent of 120 months of qualifying public-service employment, but whose loan history doesn’t add up to 120 qualifying payments because part of that time was spent in an ineligible deferment or forbearance. Buyback lets those borrowers essentially purchase the missing months, converting them into qualifying payments and unlocking forgiveness under PSLF or the related Temporary Expanded PSLF program. It has become one of the few remaining tools for borrowers whose payment history was disrupted by servicing errors, medical hardship, or the on-again, off-again legal fight over the SAVE Plan. The distinction matters because buyback does not forgive debt outright; it only converts specific ineligible months into qualifying ones, so a borrower still has to have accumulated the full 120-month equivalent of public-service work before the purchase makes any difference.
The program is run directly by the Department of Education rather than by loan servicers such as MOHELA, which point borrowers to the department’s own buyback guidance for next steps and eligibility questions. MOHELA’s own borrower materials are explicit that PSLF, including buyback, is a Department of Education program rather than a servicer program, which means changes to buyback eligibility come from the department directly and may not be reflected right away in a servicer’s own borrower-facing pages. A borrower typically needs to already have the required 120 months of qualifying employment before buyback can turn deferment or forbearance months into forgiveness-eligible payments.
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Two New Plans, One Closed Door
Starting July 1, 2026, the Repayment Assistance Plan and the Tiered Standard Plan became the two repayment options open to borrowers taking out new federal loans, replacing a patchwork of income-driven plans that the Department of Education says had grown to more than 40 combinations of repayment and discharge choices. Under the department’s updated guidance, a borrower who enrolls in either new plan forfeits access to PSLF Buyback going forward. For anyone whose realistic path to forgiveness ran through buying back a handful of forbearance months, choosing RAP or Tiered Standard now means giving up that option entirely, even if the borrower otherwise still qualifies for PSLF. Neither the fact sheet nor the department’s other public materials describe a transition period or a way to reverse the decision once a borrower has enrolled in RAP or Tiered Standard, so the restriction functions as a one-way door tied to plan selection rather than a temporary pause.
The SAVE Plan Fallout Raised the Stakes
The timing compounds an already disruptive year for borrowers. A March 2026 court order ended the SAVE Plan outright, and the department has been moving affected borrowers, nearly 8 million of them by the Student Debt Crisis Center’s count, into replacement repayment plans. Many of those borrowers spent months or years in SAVE-related forbearance while the litigation played out, exactly the kind of gap buyback was designed to fix. Someone picking a replacement plan under pressure this fall may not realize that choosing RAP or Tiered Standard forecloses the option to later buy back that forbearance time.
Income-Based Repayment Still Preserves the Option
Buyback has not disappeared for everyone. Borrowers with loans from before July 1, 2026, still have a third choice: Income-Based Repayment, one of the plans the department says will keep operating alongside RAP and Tiered Standard for borrowers who qualify. Because IBR was not named in the guidance restricting buyback, someone weighing forgiveness progress against RAP’s other new benefits, such as its monthly matching principal payment, has a reason to check what buyback is actually worth to them before switching away from IBR. That comparison is not simple, since RAP’s ongoing monthly benefits accrue for as long as a borrower stays enrolled, while buyback is a one-time purchase tied to a fixed number of past months, so the better option depends heavily on how close a borrower already is to the 120-month threshold.
No Announcement, Just Updated Guidance
The Department of Education has not issued a press release or fact sheet specifically flagging the buyback restriction. The Student Debt Crisis Center says the change appeared quietly on the department’s own web pages in late August, without the kind of public notice that accompanied the broader repayment overhaul. That leaves borrowers dependent on their loan servicer or their own research to catch the shift before they pick a plan. Anyone who has already made progress toward PSLF and is weighing RAP or Tiered Standard against Income-Based Repayment has a reason to confirm current buyback eligibility before completing a switch that now closes a door that used to stay open. Borrowers can also ask their servicer directly whether a switch would affect any pending buyback request already in process, since the guidance does not address how the department is handling applications submitted before the restriction took effect.
This article was produced with AI assistance and reviewed by a human editor. Figures are linked to their primary sources; where a claim could not be verified from the public record, we say so.
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