My mama always told me that you can't get blood from a turnip. True enough. Even so, when student loan borrowers graduate, we're told we have to start paying back our loans. That can be tough, especially for graduates still looking for work in this sluggish economy. There are lots of different repayment plans for borrowers to choose from, but if you're struggling to manage your student loan payments, consider the benefits of the Income-Based Repayment (IBR) option.
[Learn more about paying off your student loan with help from Uncle Sam.]
IBR caps student loan payments at a reasonable percentage of income. Payments are based on income and family size, with most people paying 10 percent of their income or less. Repayment of student loans under IBR is limited to a maximum 25-year period, after which the remaining balance is forgiven. All federal student loans can be repaid through IBR, even if the loans were borrowed a long time ago or the federal loan was borrowed from a bank or private lender through the Federal Family Education Loan (FFEL) program.
[Read about colleges with higher than expected loan repayment rates.]
Unfortunately, IBR is not available for private loans (another reason to step away from private loans). IBR is a good option for out of work or underpaid student loan borrowers.
More information about IBR is available from Equal Justice Works, and IBRInfo.org provides answers to your frequently asked questions.
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