Can they help me?

Income-Based Repayment (IBR)
Public Service Loan Forgiveness (PSLF)

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.

Several examples of borrowers eligible for IBR are available from the Project on Student Debt. These can be helpful in understanding how IBR works.

To apply for IBR, borrowers can log in at Studentloans.gov, enter their personal information into the Electronic IBR Application, authorize a transfer of their tax information using the IRS Data Retrieval Tool, and review, electronically sign and submit the completed form online.

All Direct Loan servicers plus several others are already in the system, and the Department of Education has said it expects to have all servicers plugged in by Spring 2013. But you don't have to know the name of your servicer to use the tool; it'll flag that for you and tell you how to proceed.

For more information, to apply for IBR, or to update your income information, please visit Studentloans.gov.

Public Service Loan Forgiveness (PSLF)

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 PSLF 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.

PSLF 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?

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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How to switch to the Direct Loan program

If your federal loans are in the Guaranteed (FFEL) program — where your lender is a private entity like Sallie Mae or Citibank — you can consolidate into the Direct Loan program to qualify for Public Service Loan Forgiveness. Even if you have already consolidated your loans in the FFEL program, you may re-consolidate into the Direct Loan program to take advantage of this program.

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