Repaying Student Loans

Michael IrelandThis post is from Michael Ireland, Director of SIT Financial Aid.

Good News for Student Loan Borrowers

It is never too early to start thinking about repaying student loans.  Some good news on the repayment front is that there are two new options that will help many students repay their loans:

The first is the Income Based Repayment (IBR) plan (available July 1, 2009).  Under IBR, your required monthly payment is capped at an amount that is intended to be affordable based on your income and family size.  Please use the following chart as a guide.  (The chart is based on a single person):

Adjusted Gross Income IBR Payment
$30,000 $172
$40,000 $297
$50,000 $422
$60,000 $547

Please follow this link for more details: http://studentaid.ed.gov/students/publications/factsheets/factsheet_IncomeBasedRepayment.pdf

The second new program is the Public Service Loan Forgiveness Program.  This program was created to encourage individuals to enter and continue to work full-time in public service jobs, including teaching in US public schools.

Borrowers may qualify for loan forgiveness of the remaining balance due on eligible federal student loans after you have made 120 payments on loans under certain repayment plans and employed full-time in non-profit, tax-exempt 501(c) (3) organizations; federal, state, local or tribal government, and AmeriCorps.

Please follow this link for more details:

http://studentaid.ed.gov/students/attachments/siteresources/LoanForgivenessv4.pdf

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