What is the Income Based Repayment Option?
The income based repayment option, or IBR as it is called, is one of the five repayment options available to you on your Federal loans. To be eligible, you must be experiencing “partial financial hardship.” If your payment under IBR is less than your payment under the Standard (ten-year) Repayment option, then you are experiencing partial financial hardship. Your payment under IBR will be 15% of discretionary income. Discretionary income is the difference between your AGI and 150% of the poverty level that corresponds to your family size and the state in which you reside.
