Income Based Repayment Plan Forgivness

Income based repayment plans typically require the borrower to make between 20 and 25 years of on-time and qualified payments before student loan forgiveness kicks in.

While income based repayment plans are far from a quick fix, there are several important benefits that you should know about.

  • Payments are always a percentage of your overall income. If you lose your job or see a reduction in wages, your required payment will go down.
  • The forgiven principal and interest balance are not subject to income taxes by the IRS.
  • Student loan forgiveness becomes an option.

  • To qualify for student loan forgiveness under an income based repayment plan, you must make your payments in full and on time.

    To Qualify After 20 Years:

  • Repayment plan status must be active
  • Student loans payments must be current
  • Student loans must be enrolled in either:
  • Pay As You Earn Repayment Plan (PAYE)
  • Revised Pay As You Earn Repayment Plan (REPAYE)

  • To Qualify After 25 Years:

  • Repayment plan status must be active 
  • Payments must be current
  • Be enrolled in one of the following repayment plans for the duration of loan payback term:
  • Income Based Repayment Plan 
  • Income Contingent Repayment Plan
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