An incomedriven repayment plan sets your monthly student loan payment at an amount that is intended to be affordable based on your income and family size. Overview revised pay as you earn repaye 2015, subject to rulemaking negotiations in february april, 2015 consensus reached nprm in july 2015 final by november 2015. Revised pay as you earn repaye eligibility requirements. Pay as you earn repayment plan paye payment limited to 10% of discretionary income, forgiveness after 20 years. You have a partial financial hardship if the monthly amount you would be required to pay on your eligible federal student loans under a 10year standard repayment plan is higher than the monthly amount you would be required to repay under pay as you earn. Kasia palm university of denver, sturm college of law. Revised pay as you earn, or repaye, is an incomedriven repayment plan that caps federal student loan payments at 10% of your discretionary income. Repaye now allows some borrowers who were previously ineligible for paye to cap their monthly student loan payments at 10% of discretionary income with repaye.
Revised pay as you earn repaye pay as you earn paye incomebased repayment ibr incomecontingent repayment icr. To qualify for pslf, i must be employed fulltime by a qualifying employer when i apply for and receive pslf. There is a sevenstep process for keeping track of your eligibility here. The public service loan forgiveness pslf program forgives the remaining. What are the pros and cons of the public service loan. Public service loan forgiveness american dental education. Revised pay as you earn repaye 10 % discretionary income 20 or 25 years both spouses income forgiveness pslf taxed even with pslf pay as you earn paye 10 % discretionary income 20 years new borrow after 10107. Help center lower payment options incomedriven repayment information center revised pay as you earn repaye frequently asked questions how do i submit my request for repaye. Repaye offers student loan forgiveness after 20 years 240 payments for borrowers with undergraduate student loans only. For the revised pay as you earn repaye, pay as you earn paye, incomebased repayment ibr, and incomecontingent repayment icr plans under the william d.
For this purpose, your eligible student loans include all of your. Borrowers in the incomecontingent, incomebased, revised payasyouearn, and payasyouearn repayment plans may be required to obtain an irs tax transcript or file irs form 4056t or the consent to disclosure of tax information form. Revised pay as you earn repaye is the new kid on the block of government income driven repayment plans. Revised pay as you earn repaye october 31, 2015 future proof, md in my previous post public service loan forgiveness pslf revisited, i mentioned that you can combine several incomedriven repayment plans with pslf.
Aug 04, 2018 in december 2015, the department of education created repaye revised pay as you earn as an extension of the current paye program. To qualify for pslf, i must make 120 qualifying payments on my direct loans while employed fulltime by a qualifying. You can continue repaying your loans under an idr plan and earn loan forgiveness after 2025 years of payments. Revised pay as you earn repaye edfinancial services. Idr plans include revised pay as you earn repaye, pay as you earn paye, incomebased repayment ibr, and incomecontingent repayment icr plans. Unfortunately, youre only eligible for paye if you first borrowed your loans on or after october 1, 2007, and received a disbursement on or after october 1, 2011. Quick facts about public service loan forgiveness pslf. Review some of the differences here, and then use our repayment planner to find the plan that works best for you.
Revised pay as you earn repayment plan repaye incomebased repayment plan ibr. Under these plans, your monthly payment is based on your income and family size. For the revised pay as you earn repaye, pay as you earn paye. Apr 03, 2019 over the last couple of months, ive learned a few obscure facts about repaye revised payasyouearn, ibr income based repayment and pslf public service loan forgiveness that are worth passing along. To qualify for pay as you earn, you must have a partial financial hardship.
Created the pay as you earn paye repayment plan, to reduce payments for many recent graduates and current students. The incomecontingent repayment icr plan, pay as you earn paye repayment plan, and revised pay as you earn repaye repayment plan are for direct loans only. Earn plan repaye plan, the pay as you earn plan paye plan, the. Revised pay as you earn repayment plan repaye plan. Repaye case studies the white coat investor investing. We have several repayment options available so you can choose which works best with your budget. Pay as you earn paye revised pay as you earn repaye regardless of which idr plan you have, you must provide your loan servicer with your updated income documentation and family status each year for recertification, even if your income and household information are the same. If you decide to work in public service, you may be eligible for federal student loan forgiveness after 10 years of fulltime. The revised pay as you earn repaye plan was recently created to further ease the burden of student loan debt. Revised pay as you earn repayment plan repaye plan pay as you earn repayment plan paye plan incomebased repayment plan ibr plan incomecontingent repayment plan icr plan if you d like. Department of education announced that it has released final regulations governing the newest incomedriven repayment plan, called the revised payasyouearn repaye plan. Your 2018 guide to federal student loan repayment plans the. Monthly payment amount determined by annual income, family size, total amount of eligible loan debt and state of residence.
Heres what you should know about the program, who qualifies and how it compares to other options. Incomebased repayment ibr, and incomecontingent repayment icr plans under. All of the incomedriven repayment plans have slight differences that may make one plan a better option for your situation. Incomedriven repayment plan request federal student aid. Mar 24, 2020 the doe already offered a pay as you earn plan, an incomedriven repayment plan that generally limits your payments to 10 percent of your discretionary income. When monthly budgets are stretched thin, incomedriven repayment plans are designed to help you affordably pay your federal student loans. While it would be nice if you only had to enroll in. Repaye was designed to remove some of the restrictions imposed by previous idr plans while adding some additional benefits. Only federal direct loans are eligible for public service loan forgiveness. The federal government is making more data available about the performance of the public service loan forgiveness pslf program for federal.
Qualifying repayment plans include the revised pay as you earn repaye plan, the pay as you earn paye plan, the incomebased repayment ibr plan, the incomecontingent repayment icr plan, the standard repayment plan with a maximum 10year repayment period, and any other direct loan repayment plan if payments are at least equal to the. Incomebased repayment ibr, pay as you earn paye or revised pay as you earn. Pay as you earn repayment plan for the direct loan program. You must recertify your family size and income annually to remain in your incomedriven repayment plan ibr, icr, paye, repaye.
Each of the four plans has unique qualifications for eligibility, and will affect your regular monthly payment amount in different ways. Make sure you submit your forms annually to the department of education to track your repayment history. Revised pay as you earn repaye is the latest program repayment option be released by the department of education. Aug 15, 2015 the plan has been called repaye, for revised pay as you earn. While millions enjoy the payment benefits of the federal incomedriven repayment programs, many do not complete the annual recertification requirement. Everything you need to know about revised pay as you earn. The following repayment plans are incomedriven plans. Incomedriven repayment plans can help lower your monthly student loan payment. This fact sheet provides only a summary of the basic requirements of the incomebased. Your federal student loans just got easier to repaye ed. To qualify for public service loan forgiveness, a borrower must. Student loan revised pay as you earn repaye calculator. And it is available to all federal direct loan borrowers with eligible loan types.
However, the plan was revised in 2015 hence the acronym re for revised in an effort to open up eligibility to about five million more borrowers. The answer has been a series of incomedriven repayment plans, including the pay as you earn paye program and its most recent offspring, the revised pay as you earn program or repaye. Some of you may be familiar with the pay as you earn paye repayment plan, which caps payments at 10% of a borrowers monthly income and forgives any remaining balance on your studentcontinue reading. If your debt load means youre struggling to meet your monthly obligation, you may want to consider enrolling in repaye revised pay as you earn repayment plan. Those wishing to seek forgiveness under the pslf should make payments under one of the incomedriven repayment plans, including income contingent repayment, income based repayment, pay as you earn, or revised pay as you earn. I consolidated my direct loans after i made qualifying pslf payments on those loans. It extends the option of incomebased student loan repayment to 5 million americans. However, the plan was revised in 2015 hence the acronym re for revised in an effort to open up eligibility to. Did you make the payments while the loans were in an eligible repayment plan. To benefit from pslf, you should be on one of the following idr plans, which generally base your loan payments on your income, family size, and loan debt. If you are on track for pslf but decide you no longer want to pursue pslf, you have several options. Revised pay as you earn repaye student loan forgiveness.
Revised pay as you earn repaye, pay as you earn paye, incomebased repayment ibr, incomecontingent repayment icr or the 10year standard repayment keep in mind that if you want to have a remaining balance to be forgiven by pslf then you should not be. Ffelp loans prior to 100107 need to be consolidated into a direct consolidation loan. Revised payasyouearn repayment repaye is an updated version of the payasyouearn repayment paye incomedriven repayment plan. It eliminates the eligibility restrictions in the paye repayment plan.
The employment requirements allow 25% of the workforce to be eligible for pslf. Public service loan forgiveness employment certification form. To see how the pslf calculations are completed, lets use an example of a pharmacy. In this student loan revised pay as you earn calculator, enter your adjusted gross income, your family size, state of residence and assumed annual income growth. Borrowers must do three things at the same time to qualify for pslf. However, to maximize your forgiveness under pslf, you should repay your loans under one of the loan programs mentioned above.
But, loan payments are not capped at standard repayment and there is a marriage penalty. Some of you may be familiar with the pay as you earn paye repayment plan, which caps payments at 10% of a borrowers monthly income and forgives any remaining balance on your student loans after 20 years of qualifying repayment. Dec 17, 2015 beginning today, federal direct loan borrowers can take advantage of a new repayment plan. You can determine if you qualify using this pay as you earn calculator from the u. Neither the 120 qualifying payments nor the employment have to be consecutive. To qualify for pslf, i must make 120 qualifying payments on my direct loans while employed fulltime by a qualifying employer or employers. Everything you need to know about revised pay as you earn repaye physicians are eligible for repaye when they fall within certain guidelines if youre considering going the public service loan forgiveness pslf route to pay off your student loans, youve probably already realized its a little more complicated than it first looks. Alternatively, you can repay your loans in full under a number of other repayment plans.
Is there really a huge loophole in the public service loan. The two programs are part of incomebased repayment plans that are quickly becoming popular with federal student loan borrowers. Employers guide to assisting employees with student loan. Revised pay as you earn, or repaye, is an incomedriven repayment plan that caps federal student loan payments at 10% of your discretionary income and forgives your remaining balance after 20 or.
To maximize forgiveness under the pslf program, you should repay your loans under one of the incomedriven repayment plans pay as you earn paye, revised pay as you earn repaye, incomebased repayment ibr, or the incomecontingent repayment icr. Unauthorized access, use, misuse, or modification of this computer system or of the data contained herein or in transit tofrom this system constitutes a violation of title 18, united states code, section 1030, and may subject the individual to civil and criminal penalties. Incomecontingent repayment plan icr payment limited to the lesser of 20% of discretionary income or payment under a 12 year fixed repayment plan, forgiveness after 25 years. Revised program will reduce student loan repayments the new. Jun, 2018 everything you need to know about revised pay as you earn repaye physicians are eligible for repaye when they fall within certain guidelines if youre considering going the public service loan forgiveness pslf route to pay off your student loans, youve probably already realized its a little more complicated than it first looks.
Revised pay as you earn repayment plan repaye plan pay as you earn repayment plan paye plan incomeased repayment plan ir plan incomeontingent repayment plan ir plan 10year standard repayment plan you must not be in default on the loans for which you are requesting forgiveness you must be employed fulltime by a public service. Public service loan forgiveness pslf if you decide to work in public service, you may be eligible for federal student loan forgiveness after 10 years of fulltime work. Repaye compared to ibr and paye for pslf hold fast to. The quickest and easiest way to submit your request for repaye is to complete the incomedriven repayment request at studentloans. As with the paye plan, loan payments are based on 10 percent of discretionary income. Obama executive order june 2014 expands the pay as you earn paye repayment plan to additional borrowers as the revised pay as you earn repaye plan. You earn repaye plan, the pay as you earn paye plan. In december 2015, the department of education created repaye revised pay as you earn as an extension of the current paye program. Qualifying repayment plans include the revised pay as. Warning this system may contain government information, which is restricted to authorized users only. The doe already offered a pay as you earn plan, an incomedriven repayment plan that generally limits your payments to 10 percent of your discretionary income.
Apply for incomedriven student loan repayment federal. Revised pay as you earn repayment plan repaye plan pay as you earn repayment plan paye plan incomebased repayment plan ibr plan incomecontingent repayment plan icr plan 10year standard repayment plan any other direct loan program repayment plan. To get started in incomebased repayment ibr or pay as you earn paye, borrowers can. Fedloan servicing can help you track time served and confirm if you are making qualifying pslf payments. How to renew your income driven repayment plan each year. If you are unable to complete the online request, you can get a copy of the. The public service loan forgiveness pslf program is a united states government program that was created under the college cost reduction and access act of 2007 ccraa to provide indebted professionals a way out of their federal student loan debt burden by working fulltime in public service. During the first year, borrowers may be required to file an alternative documentation of income form. As the name suggests, it is based on the pay as you earn repayment program, which became available to some student loan. The revised pay as you earn repaye program can help you limit student loan payments to 10 percent of your discretionary income and offers complete student loan forgiveness to those who qualify.
Pay as you earn paye, incomebased repayment ibr, revised pay as you earn repaye, or incomecontingent repayment icr. Your 2018 guide to federal student loan repayment plans. Revised pay as you earn repaye this is the newest repayment option and was intended to extend the benefits of the paye plan to borrowers who didnt meet the time criteria of that plan. Over the last couple of months, ive learned a few obscure facts about repaye revised payasyouearn, ibr income based repayment and pslf public service loan forgiveness that are worth passing along. How does the repaye student loan interest subsidy work.
After signing the paye program into law in 2012, president barack obama approved an extension to the program in 2015, offering even more federal. If you can predict how much you will pay each month, you can compare that total to what you would pay in another plan e. Repaye offers student loan forgiveness after 20 years 240 payments for borrowers with undergraduate student. Income based repayment ibr, and incomecontingent repayment icr plans under. Pay as you earn paye incomebased repayment plan ibr revised pay as you earn repaye in qualifying repayment plans payment amounts 8 repayment plan payment based only on income payment based on loan debt icr 20% of discretionary income 12year standard payment adjusted based on income ibr 15% of discretionary income 10year standard amount. Beginning today, federal direct loan borrowers can take advantage of a new repayment plan. You must be on one of the qualifying repayment plans. The public sector loan forgiveness program pslf was established by congress in 2007 to encourage individuals to work in public service by forgiving the remaining student loan balance of their federal direct loans after they have made 120 qualifying payments while employed by a qualifying employer. To maximize forgiveness under the pslf program, you should repay your loans under one of the incomedriven repayment plan s pay as you earn paye, revised pay as you earn repaye, incomebased repayment ibr, or the incomecontingent repayment icr that qualifies for pslf. Multiple plans are available to those interested in the pslf program. Student loan help incomedriven repayment great lakes. Make 120 timely, scheduled payments with an eligible incomedriven repayment plan incomebased repayment ibr, pay as you earn paye or revised pay as you earn repaye 2.
The program permits direct loan borrowers who make 120 qualifying monthly payments under. Ford federal direct loan direct loan program warning. Public service loan forgiveness application for forgiveness. This is significantly shorter than the 2025 year period required by the revised pay as you earn repayment plan repaye plan available to all workers with eligible federal student loans. This student loan revised pay as you earn calculator assumes a 3% annual income growth. The new revised pay as you earn repaye repayment plan launched on december 17, 2015 offers one of the most generous repayment benefits to date. Repaye became available to direct loan borrowers on december 17, 2015 and offers several benefits including. Ford federal direct loan direct loan program and federal family education loan ffel programs. Any other direct loan repayment plan, but only payments that are at least equal to the monthly payment amount you would be required to pay under the 10year standard repayment plan may be counted toward the 120 qualifying payments for pslf. After you fill out the ecf, make sure that your loan is transferred to fedloan servicing. Nov 30, 2018 you can determine if you qualify using this pay as you earn calculator from the u. The information below outlines the qualifying components of the pslf program, and a timeline of action to enter pslf is included on page 56 of the education debt manager. Contact your servicer to enroll in an incomedriven repayment idr plan.