Q: How are monthly payment amounts determined under income driven repayment plans?
A: Generally, your payment amount under an income driven repayment plan is a percentage of your discretionary income, and the percentage is different depending on the plan and when you took out your federal student loans.
Q: How do I estimate my eligibility and payment amount?
A: Use our Repayment Calculator to estimate your eligibility for all repayment plans, including income driven plans, give us a call at (844) 256-4901 or Start now.
Q: How long will I be in repayment under each plan?
A: Income driven repayment plans have different repayment periods.
| # | Income-Driven Repayment Plan | Repayment Period |
|---|---|---|
| 1 | IBR Plan for those who are not new borrowers on or after July 1, 2014 | Any outstanding balance is forgiven after 25 years of qualifying repayment |
| 2 | IBR Plan for new borrowers on or after July 1, 2014 | Any outstanding balance is forgiven after 20 years of qualifying repayment |
| 4 | Pay As You Earn Plan | Any outstanding balance is forgiven after 20 years of qualifying repayment |
| 5 | ICR Plan | Any outstanding balance is forgiven after 25 years of qualifying repayment |
Q: Who is eligible for income driven repayment plans?
A: Nearly everyone we have spoken to qualifies for one of the Income Driven Repayment plans. Even if you make a respectable amount of income, under the ICR Plan, there is not an initial income eligibility requirement. Any borrower with eligible federal student loans may make payments under this plan.
Q: Would I qualify for an Income Driven Repayment plans if I took out Parent Plus loans for my child?
A: Yes. In order to qualify for an Income Driven Repayment plan with a Parent Plus loan you would be required to repay under the ICR Plan.
Q: Will I always pay the same amount each month under an income driven repayment plan?
A: It is possible but not guaranteed. Any borrower who repays under any income driven repayment plan is required to recertify their loans annually, similar to being required to file your taxes annually. If your income increases your payment may increase for the following year. The same is true if your income decreases, your monthly payment could decrease. Whether your income increases or decreases don’t worry. Learn more about why our clients love Ongoing Support and how we help in dealing with Major Life Changes!
Income Driven Repayment Plan Details:
| Feature | IBR Plan | Pay As Your Earn Plan | ICR Plan |
|---|---|---|---|
| Eligible Borrowers | Direct Loan and FFEL borrowers | Direct Loan borrowers | Direct Loan borrowers |
| Eligible Loans | All Direct Loan and FFEL Program loans other than Parent PLUS loans | All Direct Loan types other than Parent PLUS loans | All Direct Loan Types |
| Income Requirement to Enter Plan | Your income must be low compared to your eligible Federal student loan debt | Your income must be low compared to your eligible Federal student loan debt | None. |
| Monthy Payment | 15% of your discretionary income (if you are not a new borrower), or 10% of your discretionary income (if you are a new borrower on or after July 1, 2014) | 10% of your discretionary income | The lesser of: 20% of your discretionary income or What you would pay on a repayment plan with a fixed payment over the course of 12 years |
| Repayment Period & Loan Forgiveness | Any outstanding balance is forgiven after: 25 years of qualifying repayment (if you are not a new borrower), or 20 years of qualifying repayment (if you are a new borrower on or after July 1, 2014) | Any outstanding balance is forgiven after 20 years of qualifying repayment | Any outstanding balance is forgiven after 25 years of qualifying repayment |