What is the Income-Based Repayment (IBR) plan?
The income-based repayment plan allows students with high debt-to-income ratios to reduce their monthly loan payments according to a formula based on income and family size. For most eligible borrowers, IBR loan payments will be less than 10 percent of their income. The government may forgive outstanding balances after 25 years. The public service loan forgiveness program may forgive remaining debt after 10 years of eligible employment and qualifying IBR payments. What is the Income-Contingent Repayment (ICR) plan? The Income-Contingent Repayment plan is available to people who don’t qualify for the IBR, but who have Federal Direct Loans and Grad PLUS loans. The government may forgive outstanding balances after 25 years. The public service loan forgiveness program may forgive remaining debt after 10 years of eligible employment and qualifying ICR payments.
