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What Is the Income Based Repayment Plan?

Your Student Debt Load Could Soon Be Lighter

Student loan repayment can be burdensome on tight budgets constricted by modest incomes. The government has developed a program that it hopes will put graduates more at ease about the issue. The Income Based Repayment plan will take effect July 1, and the federal program aims to cap monthly payments at an affordable amount based on income, family size and state of residence.

  • New loans just starting repayment and existing loans that have been in repayment are both eligible for the Income Based Repayment option.
  • Eligible loans include those used for education including undergraduate, graduate, professional, and job training.

Learn exactly which loans are eligible, just


  • The program applies to Stafford, Grad PLUS, or consolidation loans made under the Direct Loan or Federal Family Education Loan programs.
  • The Income Based Repayment option is not available to loans currently in default, parent PLUS loans, or consolidation loans that repaid a parent PLUS loan or private student loans.
  • Loan forgiveness may be granted for remaining debt after 25 years of payments, and graduates who enter public service jobs may be granted loan forgiveness after 10 years.

Ultimately, your lender will determine eligibility for the Income Based Repayment option, so contact your lender to apply. Understand that while the option makes repayment less stressful, particularly at the beginning of your career, lower monthly payments could extend your repayment period and cost you additional interest. Visit IBR Info for more information.

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