Student Loan Consolidation

Repayment Options

Choose the Best Program for you

With the standard 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 monthly payment, as the standard plan does not account for your finances.

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.

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 percent 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.

Under this plan the 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.

On 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.

What is the Public Service Loan Forgiveness Program?

Through the College Cost Reduction and Access Act of 2007, Congress created the Forgiveness Program to encourage individuals to enter and continue to work full time in public service jobs.

Under this program, borrows may qualify for forgiveness of the REMAINING balance due on their federal student loans after they have made 120 payments on those loans under certain repayment plans while employed full time by certain public service employers. Since borrowers must make 120 monthly payments on their eligible federal student loans beginning October 1, 2007 before they qualify for the loan forgiveness, the first cancellation of loan balances will not be granted until October 2017.

What are the borrowers eligibility requirements for loan forgiveness under the Public Service Loan Forgiveness Program?
  • The borrower must not be in default on the loans for which forgiveness is requested
  • The borrower must be employed full time by a public service organization for the entire 120 monthly payments
What are the Specific Loan Repayment Requirements for Loan forgiveness?
  • The borrower must have made 120 separate monthly payments beginning after October 1, 2007 on the student loan.
  • Earlier payments do not count toward meeting the requirement
  • Each of the 120 monthly payments must be made for the full scheduled installment amount within days of the due date.
  • The 120 required payments must be made under one or more of the following Department of Education programs.
  • Income Based Repayment Plan
  • Income Contingent Repayment Plan
  • Pay as you earn Repayment Plan
What types of public service jobs will qualify a borrower for loan forgiveness under this program?

The borrower must be employed full time (in any position) by a public service organization, or must be serving in a full time AmeriCorps or Peace Corps position. For purposes of the Public Service Loan Forgiveness Program, the term ”public service

Organization” means

  • A federal, state, local, or Tribal government organization, agency, or entity 9includes most public schools, colleges and universities)
  • A public child or family service agency
  • A non-profit organization under section 501(c)(3) of the Internal Revenue Code that is exempt from taxation under 501(a) of the Internal Revenue Code (includes most not for profit private schools, colleges and universities) or an organization engaged in religious activities (unless the qualifying activities are unrelated to religious instruction, worship services, or any form of proselytizing) and that provides the following public services:
    • Emergency Management
    • Military
    • Public Safety
    • Law enforcement
    • Public interest in law services
    • Early childhood education(including licensed or regulated health care, Head start, and state-funded pre-kindergarden)
    • Public Service for individuals with disabilities and the elderly
    • Public health (including nurses, nurse practitioners, nurses in a clinical setting and full time professionals engaged in health care practitioners occupations and health care support occupations)
    • Public education
    • Public library services, and school library or other school-based services

Are you eligible?