Name: Federal Student Loan Repayment Program - FileUnemployment.org
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Federal Student Loan Repayment Program - FileUnemployment.org

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This site is privately owned and is not affiliated with any government agency. Home&nbsp;/&nbsp;Federal Aid&nbsp;/&nbsp;If you have taken federal education loans, you must repay them regardless of whether you are still in school or have graduated. To ensure that your payments are manageable, you must first plan how to repay the loan and determine which repayment plan suits you.If you are unaware of the types of student loan repayment plans or are wondering which plan you should opt for, you have landed on the right page. Here, we will walk you through the different types of federal education loan repayment plans to help you find the best fit.Generally, your education loans go into repayment when you drop below half-time enrollment, graduate, or leave school. But you will have a “grace period” for the repayment of certain types of federal education loans.A grace period is the number of months between the date you leave school or graduate and the first payment due date. The grace period gives you time to select a repayment plan and settle financially.As mentioned earlier, only some federal education loans have a grace period. For instance, if you have opted for a Direct Unsubsidized, Direct Subsidized, or Federal Family Education Loan (FFEL) program, you will have a 6-month grace period before you begin repaying the loan. If you have taken a Perkins Loan, you may have a 9-month grace period.If you have taken PLUS loans, you will not have a grace period unless you have received the loan as a graduate or professional student. In such situations, you will get a 6-month deferment when you drop below half-time enrollment, leave school, or graduate, and no payments are required during this period.If you are a parent who borrowed a PLUS loan to pay your child’s education fee, you can request a 6-month deferment once your child drops below half-time enrollment, graduates, or leaves school.Once your grace period ends, you have to begin making your payments. Note that you can use the grace period only once per loan. You will not get a second grace period if you go back to school and graduate from the subsequent program post the expiration of an initial grace period.It is important to note that interest accumulates for most federal education loans during your grace period. However, it is up to you to pay the interest during your grace period. If you don’t pay the interest during this period, it adds to your principal amount (popularly known as interest capitalization). Borrower TypeParents and Graduate or Professional StudentsGraduate or Professional BorrowersUndergraduate BorrowersLoan TypeDirect PLUS LoansDirect Unsubsidized LoansDirect Subsidized Loans and Direct Unsubsidized LoansInterest Rate6.28%5.28%3.73%Perkins loans have a fixed 5% interest rate regardless of the first disbursed date.Note – Most federal education loans include fees (commonly known as loan fees) that are a percentage of your total loan amount. These fees are proportionately deducted from each education loan disbursement you receive while enrolled in a school. This indicates that the total money you get will be less than the amount you borrowed. However, you must repay the entire borrowed amount during the repayment process and not just the received amount.There are several federal student loan repayment plans. Below, we have listed the types of repayment plans and when you can use them. You should opt for the Standard Student Loan Repayment Plan if you want to pay off the loan as quickly as possible. This plan has higher monthly payments, which means you will pay the slightest interest throughout the loan. This allows you to clear off the loan in the shortest possible time and save your money over time.Under the Standard Repayment Plan, the monthly payments are a fixed amount (a minimum of $50 per month) and made for up to 10 years for all types of a loan, excluding the FFEL Consolidation Loans and Direct Consolidation Loans.You can use this plan if you have opted for any of the following loans from the FFEL and Direct Loan program: You can opt for the Graduated Repayment Plan if your income is currently low but is expected to increase over the period. In this type of repayment plan, the payments are lower and gradually increase (usually every two years). With the Graduated Repayment Plan, you can pay off your federal education loans within ten years, except for Consolidation loans that take about 10 to 30 years.You can choose this type of repayment plan if you have opted for any of the following loans: The Extended Repayment Plan is the best fit to make lower monthly payments over a more extended period. Under this repayment plan, the payments may be graduated or fixed. Through this plan, you can repay the loan within 25 years.To qualify for the extended repayment plan, you must meet specific requirements. They include:You can use this plan if you have opted for any of the following loans from the Federal Family Education Loan (FFEL) and William D. Ford Federal Direct Loan (Direct Loan) Program. Here, your payment is based on your family size and income. Your monthly payments will typically be 10% of your discretionary income, and the payments are recalculated each year.Under the REPAYE Plan, your spouse and your income or debt will be considered regardless of whether the taxes are filed separately or jointly (with limited exceptions).Note that your loan will be forgiven if you haven’t repaid it entirely after 25 years (if the loan was taken for professional or graduate purposes) or 20 years (taken for undergraduate study).You can use this plan if you have opted for any of the following loans: In this plan, payments are based on the total amount of your Direct Loans, income, and family size. Your monthly payments will be 20% of your discretionary income or the amount you would pay on a repayment plan over 12 years with a fixed payment, whichever is lesser. The monthly payment under this plan is regularly recalculated each year based on your updated family size and income.Under the ICR plan, your spouse’s income or debt will only be considered if you choose to repay your Direct Loans jointly or file a joint tax return.Note that your loan will be forgiven if you haven’t repaid it entirely after 25 years.You can use this plan if you have opted for any of the following loans: You can opt for a student loan income-based repayment plan only if you have a high loan compared to your income. In this plan, your monthly payments will be 10% or 15% of discretionary income. The monthly payments are recalculated every year based on your updated income and family size. Under this plan, your spouse’s income or loan will only be considered if you file a joint tax return.Note that your loan’s outstanding balance will be forgiven if you haven’t fully repaid it after 20 or 25 years. However, you must pay income tax on the amount forgiven.You can use this plan if you have opted for any of the following loans: If you want to pay lower monthly payments, then the Income-Sensitive Repayment Plan is the best fit. Under this plan, the monthly payments are made for a maximum of 10 years and are increased or decreased depending on your income.You can opt for this plan if you have taken loans through any of the following programs.Note –Perkins Loan repayment plans are not the same as those for FFEL Program or Direct Loan Program loans. Talk to your school authorities to know more about the Perkins Loan repayment plans.You can choose a preferred repayment plan to clear off your federal education loans. If you don’t opt for a plan, you will automatically be entitled to the Standard Repayment Plan.Federal Student AidFederal Student LoanFederal ScholarshipsFederal Student GrantsBack to Federal Aid https://fileunemployment.org

This site is privately owned and is not affiliated with any government agency. Home&nbsp;/&nbsp;Federal Aid&nbsp;/&nbsp;If you have taken federal education loans, you must repay them regardless of whether you are still in school or have graduated. To ensure that your payments are manageable, you must first plan how to repay the loan and determine which repayment plan suits you.If you are unaware of the types of student loan repayment plans or are wondering which plan you should opt for, you have landed on the right page. Here, we will walk you through the different types of federal...

Federal Student Loan Repayment Program - FileUnemployment.org

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