It's important to know you may have repayment options. Learn about the alternatives and find a repayment plan that fits your budget. If your loan is in default, find out about available repayment options.
See which repayment plan works for you:
Make it a habit to review your repayment plan every year to make sure it's still a good fit for your financial situation.
Contact your servicer(s) to discuss your options. If you don't know who your servicer(s) is, go to the National Student Loan Data System (NSLDS), which is the central database for all federal student loan information.
Repayment plan comparison calculator
Follow the link below to the U.S. Department of Education's repayment plan comparison calculator and find the payment plan that fits your financial situation.
Standard repayment allows you to pay your loan(s) over 10 years in equal monthly installments. Because you begin paying down the principal immediately, Standard repayment may cost you less over the life of the loan compared to other plans.
Key features of Standard repayment:
Graduated repayment is designed for those who have a low salary early in their repayment period, but anticipate higher incomes in the future. Payments start low and gradually increase over time.
Graduated repayment is a compromise between Standard repayment and the higher lifetime costs of Extended repayment.
Key features of Graduated repayment:
Borrowers with more than $30,000 in FFEL Program or Direct Loan Program loans—separately, not combined—can lower their monthly payments by extending their payments for up to 25 years. While it does save money in the short term, Extended repayment may create higher overall costs.
Key features of Extended repayment:
These plans may make it easier for you to afford your loan payments. If you have a career in public service or you teach at a school with a high percentage of low-income students, for... Read more >
Income-driven plans can be a good choice if your income is small relative to your student loan debt.
|Repayment Plan||Who qualifies|
|Income-Based Repayment (IBR) for new borrowers as of 7/1/14||FFEL and Direct loan borrowers|
|Income-Based Repayment (IBR) for those who borrowed prior to 7/1/14||FFEL and Direct loan borrowers|
|Pay As You Earn (PAYE)||Direct loan borrowers only|
|Income-Contingent Repayment (ICR)||Direct loan borrowers only|
To determine your eligibility and to sign up for a new federal student loan repayment plan, contact your servicer(s). If you don't know who your servicer(s) is, go to the National Student Loan Data System (NSLDS), which is the central database for all federal student loan information.
Income-Based Repayment (IBR)
IBR is a repayment option based on income and family size. For most, your maximum monthly IBR payment will be less than 10% of your income. IBR will also forgive any remaining debt after 25 years of qualifying payments, although the Internal Revenue Service may treat any forgiven loan amount as taxable income. Consult a tax professional.
Key features of IBR:
To see if you qualify for IBR, contact your servicer(s) or follow the link below to the U.S. Department of Education's Repayment Estimator.
Income-Sensitive Repayment (ISR)
This program may be a good option if you have a Stafford, PLUS or Grad PLUS loan(s) under the FFEL Program and want to lower your payments for a relatively brief period of time. With an ISR plan, your servicer(s) determines your monthly payment based on your Adjusted Gross Income and will readjust your payments annually based on your reported earnings.
Key features of ISR:
ISR can help you stay current with your payments if you're facing an income shortfall, but if you think you'll need lower payments for more than a year, you may want to consider Extended or Graduated repayment.
Income-Contingent Repayment (ICR)
With ICR, monthly payments are calculated based on your income, family size and the total amount borrowed.
If you complete 25 years of repayment under the ICR plan, any remaining debt will be forgiven, although the Internal Revenue Service may treat any forgiven loan amount as taxable income. Consult a tax professional.
Key features of ICR:
Pay As You Earn (PAYE) Plan
With PAYE, monthly payments are calculated based on your Adjusted Gross Income and family size. The monthly payment amount is recalculated annually to reflect changes in your income and family size, and is generally 10% of your discretionary income. Any remaining balance is forgiven after 20 years of payments, or after 10 years under the Public Service Loan Forgiveness Program.
Key features of PAYE:
You may be able to lower your payments through consolidation. The Direct Consolidation Loan Program lets you combine one or more federal student loans into a single new loan. So instead... Read more >
The Direct Consolidation Loan Program lets you combine one or more federal student loans into a single new loan. So instead of making several different student loan payments, you make one monthly payment for all your federal student loans. Consolidation may lower your monthly payments and extend your repayment term.
If you have FFEL Program loans you may be able to consolidate in the Direct Consolidation Loan Program. Contact your servicer(s). If you don't know who your servicer(s) is, go to the National Student Loan Data System (NSLDS), which is the central database for all federal student loan information.
For more information, contact the U.S. Department of Education at http://www.studentloans.gov/.
Loans that qualify for consolidation
Almost all federal student loans qualify for consolidation. Some of the more common loans include:
How long you have to pay back your consolidated loan
How long you have to pay back your consolidated loan depends on the amount of the loan and the repayment plan. Contact your servicer.
Grace periods and consolidated loans
Consolidation loans do not have six- or nine-month grace periods the way some other loans do—you must begin repayment on a consolidation loan within 60 days of disbursement, regardless of whether the grace periods on the individual loan(s) has ended.
One question to consider is when to consolidate—before or after the grace periods on your individual loan(s) ends. Waiting to consolidate until after that six-month to nine-month grace period allows you to delay repayment.
However, if you consolidate sooner you may be able to lock into a lower, fixed interest rate on your consolidation loan before the variable interest rates on your individual loan(s) start to rise. In that case, consolidating early could help you save money in the long run. Talk to your servicer.
Repayment options for consolidated loans
Consolidated loans feature the same repayment options as other federal loans, ranging between Standard repayment, Extended repayment, Graduated repayment, Income-Sensitive Repayment, Income-Contingent Repayment, or Income-Based Repayment plans. The repayment period will last 10 to 30 years depending on your student loan debt and the plan you've chosen.
For more information, visit our Loan consolidation section.
Disadvantages to consolidating your loan(s)
Consolidation can be a good repayment option, but it's not for everyone. Your new consolidation loan may have a longer repayment period than remained on your individual loan(s).
Consolidation presents unique disadvantages for Perkins loan borrowers because it replaces the longer grace periods and cancellation benefits of Perkins loans with the standard federal loan terms.
Here are some disadvantages to consolidating your loans:
Talk to your servicer(s). They can help you consider the pros and cons of consolidating your loans.