If you are in default we can help you find some of the best Federal mandated rehabilitation options.
For your Federal Student Loans, there are plenty of options that are allowed by Federal law. We can help find the best option that you may qualify for and assist in the application process.
We can provide insight into forgiveness programs that may be available for your situation, although such programs take 10, 20, or even 25 years to complete.
With the standard plan student loan repayment plan, you’ll pay a fixed amount each month until your loans are paid in full. Your monthly payments will be at least $50, and you’ll have up to 30 years to repay your loans with a fixed interest rate. The standard plan is a good fit for you, if according to your budget the IBR, ICR, and PAYE plans are higher in a monthly payment, as the standard plan does not account for your finances.
Under this plan, your required monthly payment will be based on your income during any period when you have a partial financial hardship. Your monthly payment may be adjusted annually. The maximum repayment period under this plan may exceed 25 years. If you meet certain requirements over a specified period of time, you may qualify for cancellation of any outstanding balance of your loans.
This plan gives you the flexibility to meet your Direct Loan obligations without causing undue financial hardship. Each year, your monthly payments will be calculated on the basis of your adjusted gross income (AGI, plus your spouse’s income if you’re married), family size, and the total amount of your Direct Loans. Under the ICR plan you will pay each month the lesser of:
If your payments are not large enough to cover the interest that has accumulated on your loans, the unpaid amount will be capitalized once each year. However, capitalization will not exceed 10% of the original amount you owed when you entered repayment. Interest will continue to accumulate but will no longer be capitalized. The maximum repayment period is 25 years. If you haven’t fully repaid your loans after 25 years under this plan, the unpaid portion will be discharged. You may, however, have to pay taxes on the amount that is discharged.
With this plan, your payments start out low and increase every two years. The length of your repayment period will be up to 30 years. If you expect your income to increase steadily over time, this plan may be right for you. Your monthly payment will never be less than the amount of interest that accrues between payments.
In December 2012 the DOE announced that borrowers with Federal Student Loans may now be able to take advantage of a new repayment plan that could lower their monthly federal student loan payments. The plan, known as Pay As You Earn, caps monthly payments for many recent graduates at an amount that is affordable based on their annual income. This new option follows through on President Obama’s promise to provide student graduates with relief on their student loan payments and help them responsibly manage their debt payments.
In all income-driven repayment plans, the amount of your monthly payment will be calculated on the basis of the money you make, not the money you owe—specifically, your payment will be based on your discretionary income. Generally speaking, discretionary income is the amount of money you have to spend each month after you pay for the essentials, like rent, utilities, and food. While you can’t really decide not to pay your rent in a given month, you can decide not to go shopping for new clothes — the clothes portion is discretionary. Rather than try to figure out what each person’s expenses are essential compared with their discretionary income, the federal government has a way of calculating your discretionary income: They start with your adjusted gross income (i.e., the income after all legitimate deductions, on which your federal income tax is calculated, also referred to simply as AGI). Then they subtract 150% of the federal poverty line for your family size. The difference between your AGI and 150% of the federal poverty line for your family size is your discretionary income — and that’s the number that will form the basis for calculating your monthly loan payment.
The PSLF Program was established to encourage individuals to work in public service by forgiving the remaining balance of their Direct Loans after they have made 120 qualifying payments while employed by a qualifying employer.
You must be employed full-time by a qualifying employer when you make each of the required 120 qualifying payments on your Direct Loans, and also at the time you apply for loan forgiveness after making the last of those 120 payments, and when you receive loan forgiveness.
No. According to the Internal Revenue Service (IRS), student loan amounts forgiven under PSLF are not considered income for tax purposes. For more information, check with the IRS or a tax advisor.
There is no income requirement to qualify for PSLF. However, since your required monthly payment amount under most of the qualifying PSLF repayment plans is based on your income, your income level over the course of your public service employment may be a factor in determining whether you have a remaining loan balance to be forgiven after making 120 qualifying payments.
We cannot make any guarantees about the future availability of PSLF. The PSLF Program was created by Congress, and Congress could change or end the PSLF Program.
PSLF is available only for Direct Loans. However, if you have loans made under another federal student loan program, you may consolidate those loans into a Direct Consolidation Loan, which is eligible for PSLF.
Consolidation Loans are available to most borrowers of Federal education loans and come from one of two sources — Direct Consolidation Loans and Federal Consolidation Loans.
The Financial meaning of the term: Taking Multiple debts or credit lines and consolidating them into one new payoff plan. Frequently, this is a consolidation loan, provided to consolidate debts into one loan with one payment.
Consolidation loans allow borrowers to combine one or more of their Federal education loans into a new loan that offers several advantages.
Borrowers can choose from multiple repayment plans with various term selections to repay their consolidation loan(s), including an Income-Based Repayment (IBR), Income Contingent Repayment (ICR), or Pay as You Earn (PAYE). These Plans are designed to be flexible to meet the different and changing needs of borrowers. With a consolidation loan, borrowers can switch repayment plans at any time.
There is no minimum amount required to qualify for a Direct Consolidation Loan.
A consolidation loan may ease the strain on a borrower’s budget by lowering the borrower’s overall monthly payment. The minimum monthly payment on a consolidation loan may be lower than the combined payments charged on a borrower’s Federal education loans.
All federal and private student loans are considered unsecured debt. That means they are not backed by collateral, by some asset – a house, a car, or a piece of land. Unsecured student loan debt is looked upon more favorably by lenders when it comes to evaluating your creditworthiness. Student loan debt is often considered good debt because it represents an investment in your future. If you are timely in making your federal and/or private student loan payments to your lender, having this type of debt can actually begin to strengthen your credit rating after about six months of steady payment. Better yet, if your student loans are consolidated, thereby reducing the number of active accounts on your credit report, it can heighten your score as well.
Thank you all so very very much!!!!
It is such a relief to get out from underneath this loan. It has weighted on my heart for a while. Other agencies that I have tried I could not do what you have done and I am greatly appreciative.
So, thank you again. God bless you. Have a great week!
Thank you, Thank you, Thank you both for ALL your help!