On March 31, 2026, the Department of Education quietly changed how it calculates PSLF Buyback payment amounts for borrowers who were enrolled in the SAVE plan. Instead of using the SAVE formula—which produced lower monthly figures—the department now uses IBR, PAYE, or ICR formulas. The result: buyback costs can be nearly three times higher than borrowers expected. Roughly 88,000 borrowers with pending buyback applications are affected.

If you were counting on Public Service Loan Forgiveness Buyback to fill in gaps in your 120-payment count, the math changed on March 31, 2026—and it changed significantly.

The PSLF Buyback program lets public servants make retroactive payments for months they couldn't earn forgiveness credit because their loans were in forbearance or deferment. It's been a valuable tool for borrowers who lost months during the SAVE plan forbearance period. But the Department of Education has changed how it prices those buyback months, and for borrowers who were on SAVE, the new cost is dramatically higher.1

What Changed and Why

Before March 31, the department calculated buyback payment amounts using the same formula as the borrower's active repayment plan. For SAVE borrowers, that meant payments were calculated using the SAVE formula—which uses 225 percent of the federal poverty level as the income exemption threshold. That higher exemption meant lower monthly payment figures.

Under the new policy, the department will no longer use the SAVE formula for buyback calculations—even for periods when the borrower was actually enrolled in SAVE. Instead, buyback amounts are now based on IBR, PAYE, or ICR formulas, which use a lower income exemption of 150 percent of the federal poverty level.1

The lower exemption means more of your income counts toward your payment. Which means a higher buyback bill.

3x — is how much more some PSLF borrowers now owe for each month they buy back. A borrower who would have owed $4,300 under the SAVE formula may now owe $12,800 under IBR, according to CNBC reporting.

Who Is Affected

The change applies to new buyback offers only—not agreements that were already issued and accepted. If you already received and signed a buyback offer before March 31, your terms should not change.

For borrowers with pending applications, the impact is real. According to CNBC's reporting on the change, approximately 88,000 borrowers with unresolved buyback applications are affected.1

The rule applies to periods on or after July 1, 2024. If the forbearance or deferment period you're trying to buy back started or ended on or after that date, the new formula applies.

If you submitted a PSLF Buyback application and have not yet received an offer, do not assume the amount will match the SAVE formula. Contact your loan servicer directly to understand what formula will be used before you commit to paying.

Is Buyback Still Worth It?

It depends on the math specific to your situation.

The core question is: how does the per-month buyback cost compare to what you would pay by just continuing to make regular monthly payments?

If each month of buyback costs you $1,200 under IBR but your regular monthly payment under a qualifying plan is $300, buying back that month costs four times more than simply waiting and continuing to make payments. In that scenario, continuing to pay is the better path.

On the other hand, if you're close to 120 payments and need only a few months, the buyback might still be worth it even at the higher cost—especially if those months represent the difference between forgiveness this year versus years from now.

Expert advice: run the numbers yourself or use a federal student loan calculator to compare your monthly payment on the most affordable qualifying plan against the per-month buyback cost. The IBR vs. standard repayment comparison matters here.

How This Fits the Broader PSLF Picture

This calculation change is separate from the other PSLF rule taking effect July 1, 2026. That rule—which we covered in our PSLF employer rule post—gives the Education Secretary authority to disqualify employers whose work has a "substantial illegal purpose." That rule affects whether your employer counts. The buyback change affects how much it costs to fill gaps in your payment history.

Both changes are part of a broader restructuring of student loan forgiveness programs under the current administration.

For context on what's happening to income-driven repayment plans broadly: the SAVE plan is ending, and borrowers have 90 days starting July 1 to choose a new plan. The RAP plan launches July 1 as the replacement.

Steps for Borrowers With Pending Buyback Applications

  1. Contact your loan servicer now. Ask whether your buyback offer has been issued, and if not, ask what formula will be used to calculate your amount.
  2. Calculate your regular monthly payment. Figure out what you'd pay on IBR, PAYE, or RAP going forward. If that number is lower per month than the buyback cost per month, continuing to make regular payments may be smarter.
  3. Check your eligibility. The change applies to periods on or after July 1, 2024. Periods before that date may still be calculated under your original plan formula.
  4. Don't pay until you understand the terms. The buyback is voluntary. You are not required to accept an offer, and there's no penalty for choosing to continue making regular payments instead.

If you're thinking about how much student debt is too much, the buyback cost change is one more reason to run careful projections before committing to any repayment strategy.

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Footnotes

  1. CNBC. (2026, April 9). Student loan forgiveness for public servants could be pricier to access, after new changes. CNBC. https://www.cnbc.com/2026/04/09/public-service-loan-forgiveness-may-be-pricier-to-access-after-changes.html ↩ ↩2 ↩3

  2. TheStreet. (2026). Student loan forgiveness for public servants just got pricier. TheStreet. https://www.thestreet.com/personal-finance/student-loan-forgiveness-for-public-servants-just-got-pricier ↩