If you have student loans you may be able to lower your payments with the government’s Income Based Repayment (IBR) plan.  IBR is a new repayment plan for the major types of student federal loans, which include any Stafford, Grad PLUS or Consolidation loan made under either the Direct Loan or FFEL program.  However, if you are in default you are out of luck.   Additionally, parent PLUS Loans or consolidation loans that repaid a parent PLUS Loan are not allowed as well.

IBR caps your required monthly payment at an amount that should be affordable based on your income and family size.  New and old loans for any type of education (undergraduate, graduate, professional, job training) may qualify for the IBR plan.

You may apply for IBR if your federal student loan debt is high relative to your income and family size. Your lender will determine your eligibility, however, you can use the Departments IBR calculator to estimate if you would likely benefit from the IBR plan. The calculator looks at your income, family size, and state of residence to calculate your IBR monthly payment amount. If that amount is lower than the monthly payment under a 10-year standard repayment plan, then you are eligible to repay your loans under IBR.

For more information visit studentaid.ed.gov.

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