Take Action to Improve Income-Driven Repayment!

At TICAS and our Project on Student Debt, we work closely with other advocates to keep borrowers' needs front and center when the U.S. Department of Education develops new student loan regulations.

Here's more about the changes we're calling on the Department to make before finalizing rules that include a new income-driven student loan repayment plan, called Revised Pay As You Earn (REPAYE):

1. Provide loan forgiveness to all borrowers in REPAYE after 20 years of payments. As proposed, borrowers in REPAYE who have any graduate school loans will be required to make 25 years of payments on all of their loans before any remaining debt is forgiven, while borrowers with only undergraduate loans can receive forgiveness after 20 years. We think 20 years is long enough to have to repay your student debt. A maximum 20-year repayment period will help all borrowers focus sooner on other important priorities, like saving for retirement and their own children's education.

2. Count qualifying payments made before or after consolidation towards forgiveness. Under IBR, PAYE, and the proposed REPAYE, any remaining debt is forgiven after 20 or 25 years of qualifying payments. But, if a borrower consolidates multiple loans into one loan, qualifying payments made before the loans were combined suddenly don't count anymore. Borrowers should get credit for all qualifying payments.

3. Make it easier for borrowers to keep making payments based on income. Rather than having to proactively submit new income information every year or get bumped to a non-income-based payment, borrowers should be able to give advance permission for the Department of Education to automatically access the required tax information (sometimes called "multi-year consent"). Borrowers used to be able to do this, and they should be able to again. They could revoke their permission at any time.

Ultimately, we think there should be just one income-driven repayment plan, but that requires legislative change.  If improved through this regulatory process, REPAYE could serve as the model!

Your comments must be submitted by August 10! Please take a moment to submit a comment and make sure your voice is heard. It's easy – just follow these instructions:

Instructions

  • Visit the U.S. government's www.regulations.gov webpage
  • Click the "Comment Now!" button in the top right-hand corner
  • Users are only required to enter a category and comment, but we encourage you to include your name, city, and state
  • To use our suggested language, simply copy the message below and paste it  into the "Type Comment" field
  • Once you're satisfied with your comment, hit Submit.

 Suggested Message – for you to cut & paste or edit:

As a student loan borrower, I strongly support the Department's efforts to let all Direct Loan borrowers cap their monthly payments at 10% of income, and to prevent ballooning loan balances by limiting interest accrual for borrowers with low income relative to their debt.

However, the proposed Revised Pay As You Earn (REPAYE) plan should be improved to better reduce the burden of student debt. I urge you to make the following changes to REPAYE before it is finalized:

1. Provide loan forgiveness to all borrowers after 20 years of payments.

2. Count qualifying payments - made before or after consolidation - towards forgiveness.

3. Make it easier for borrowers to keep making payments based on their income by letting them choose to have their income information updated automatically.

Sincerely,

Income-Based Repayment and Pay As You Earn are two ways to help keep monthly payments affordable based on your income and family size. Visit the Department of Education’s Repayment Estimator to find out what your payments might be.
 

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