IBRinfo

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Income-Based Repayment (IBR)

IBR is designed to help borrowers whose income makes a Standard (10-year) loan payment hard to afford. Anyone with eligible loans can apply to see if his or her payments will be more affordable under IBR.

IBR can help you if:

• You have federal student loans in either the Direct or Guaranteed (FFEL) Loan program.
• Your loans include Stafford, Grad Plus, and federal Consolidation loans that do not include Parent PLUS loans. Perkins loans are eligible if you consolidate them into a federal Guaranteed (FFEL) or Direct loan.
• You borrowed before or after IBR was created, for either graduate or undergraduate study.
• Your debt-to-income ratio qualifies you for reduced payments. Use our calculator to check if you might meet this test.

IBR is not available for:

• PLUS loans made to parents, or Consolidation loans that include Parent PLUS loans.
• Private (or "alternative") student loans, state loans, and other loans not guaranteed by the federal government.

If you are married, you should be aware that both your spouse’s income and your own income are considered to determine the resources you have available to make payments on your federal student loan(s). This is true whether or not your spouse is also making student loan payments. Therefore, under current IBR regulations, when two married individuals both have student loan debt and file taxes jointly, they could be expected to pay up to double the monthly loan payment of two unmarried borrowers in otherwise identical situations.

However, the U.S. Department of Education has agreed to revisit this rule and factor in both spouses' debts when calculating one applicant's IBR payments, but that change would not go into effect until as late as July 2010. In the meantime, the current rules will apply. Please sign up for our mailing list so we can keep you updated on these and other changes. More information is available here.

To apply for IBR, contact your lender. If your lender is the U.S. Department of Education, start here. If you do not know who your lender is, search the National Student Loan Data System database.

Public Service Loan Forgiveness

This benefit is for people who work in certain "public service" jobs in government and nonprofit 501(c)(3) organizations (for details see What are eligible jobs?). The program will forgive remaining federal student loan debt after 10 years of eligible employment and qualifying payments.

You may qualify for Public Service Loan Forgiveness if:

• You have federal student loans in the Direct Loan program. Covered loans include Stafford, Grad PLUS, or Consolidation loans through the Direct Loan program.
  • If your federal loans are not in the Direct Loan program, you may be able to switch (see box on the right to find out more).
• Your Direct loans originated before or after the loan forgiveness program was created, for either graduate or undergraduate study.
• You work full time in an eligible job.
• While working in an eligible job, you make qualifying payments for a total of 10 years (120 monthly payments which do not have to be consecutive). As long as you are in the Direct Loan program, these payments can be made through the Standard (10-year) repayment, Income Contingent Repayment (ICR), and/or Income Based Repayment (IBR) plans.
• You are still working full time in an eligible job and have debt remaining after 120 qualifying payments.

If you believe you meet these requirements, you likely qualify for Public Service Loan Forgiveness. However, only the Department of  Education can confirm your eligibility, and it has yet to establish a formal application process. Please register here for updates as more details become available.

Public Service Loan Forgiveness is not available for:

• Private (or "alternative") student loans, state loans, and other loans not guaranteed by the federal government.
• Payments made on federal loans in the Guaranteed (or FFEL) program.
  • If your federal loans are not in the Direct Loan program, find out how to switch (see box on the right to find out more).
• Payments made under graduated or extended repayment plans.
• Payments made or work performed before October 1, 2007.

How do I get them?