- Income-Based Repayment (IBR) for Federal Student Loans
The federal government's income-based repayment program (IBR) for student loans allows qualified borrowers to tie their monthly federal student loan payments to their discretionary income. A new version of the IBR program called "Pay As You Earn" took effect on December 21, 2012 (it was originally scheduled to be phased in during 2014, but the Obama administration took regulatory measures to make it available sooner). The potential for IBR to change the landscape for college borrowers is enormous. According to the U.S. Department of Education, as of last October, about two million borrowers had applied for IBR.
- Student loan basics
Repaying your student loans is serious business! To help you meet this obligation, most lenders offer a short grace period before your first payment is due, as well as flexible repayment plans. Besides the standard 10-year repayment plan, you might be able to choose a graduated repayment plan, an extended plan, or an income-based plan. In most cases, you can consolidate several loans into one loan, often with a lower interest rate. And if you're experiencing financial difficulties, ask your lender about a deferment or forbearance--don't just stop paying on your own.