New Income-Based Repayment (IBR) plan for federal student loans

This caught my eye in the August 13, 2009 Weekly Forefield Alert:

On July 1, the federal government's new Income-Based Repayment (IBR) plan for federal student loans went into effect. Under this program, a borrower's monthly student loan payments will be based on his or her income and family size. More specifically, annual loan payments will be 15% of the difference between a borrower's gross income and 150% of the federal poverty level (the latter depends on family size and state of residence). Monthly payments are then calculated as one-twelfth of that amount. After 25 years of qualifying payments, the principal loan balance may be forgiven.

The program is open to graduates who have a Stafford, Graduate PLUS, or consolidation student loan made under either the William D. Ford Federal Direct Loan or Federal Family Education Loan programs. The loans could be for undergraduate, graduate, or professional studies, as well as for job training. To enroll in the plan, borrowers should contact their lender.

Details are available on the studentaid.ed.gov website.

From:
Alert@forefield.com
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