September 27, 2022

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Income-driven repayment plan: How you can make smaller payments of your student loan

All students borrowers interested in having a plan to organize their loans should check the Income-Driven Repayment.

The Income-driven repayment is a plan designed to make your student debt more manageable by reducing your monthly payment amount.

According to Federal Student Aid, you can get help to organize your payment plan.

Who is eligible?

Most federal student loans are eligible for at least one income-driven repayment plan.

The Income-driven repayment helps student borrowers that have higher debt than income. It is intended to be affordable based on your income and family size.

Who can apply for it?

If you need to make lower monthly payments or if your outstanding federal student loan debt represents a significant portion of your annual income, one of the following income-driven plans may be right for you.

Student loans borrowers who don’t have an IDR Plan and are seeking a lower monthly payment on their federal student are eligible.

Also, borrowers on an IDR Plan who need to re-certify or make changes to their repayment plan can apply for a different plan.

There is no application fee to complete an Income-Driven Repayment Plan request. You may be contacted by private companies that offer to help you apply for Income-Driven Repayment, for a fee.

The IDR Plan has no affiliation with the U.S. Department of Education (ED) or ED’s Federal Loan Servicers.

What’s the IDR Plan about?

The Income-Driven Repayment Plan generates your payment amount under an income-driven repayment plan as a percentage of your discretionary income.

The percentage is different depending on your income and family size, you may have no monthly payment at all.