Tuesday, October 5, 2010

Repayment Options for the Parent PLUS loan

If you are a parent who has taken out a PLUS loan to cover some of your child’s education, you might be wondering what methods of repayment are available to you. While many parents opt for standard repayment, there are other options as well:
The Graduated Repayment Plan allows you to start out with lower monthly payments that gradually increase over time until the loan is paid in full. The required monthly payment is calculated based on your loan debt and interest rate.
The Income-Sensitive Repayment Plan bases your monthly payment on your yearly income and your loan amount. You are eligible for this plan only if you monthly loan payment is greater than ten percent of your annual gross income.
The Extended Repayment Plan provides eligible loan borrowers with payment relief through an expanded repayment term of up to 25 years.

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