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New Student Loan Rules as of July 1!

As of July 1, students with loans have new and better rates for repayment. And students who need to get loans have better deals and rates. Visit Studentaid.ed.gov to see lots of helpful information.

Repayment plans includes several plans:

1. A standard plan where you pay back in 10 years, which can reduce the amount of interest you pay;

2. An extended plan where you can take up to 25 years to repay in smaller monthly payments (but you must meet certain qualifying standards);

3. Graduated payments where your payments start small, but get bigger as you *hopefully* earn more money after being in the workforce for a longer time;

4. Income-based repayment. This is the big change that became available July 1.

a) If you are a government employee, or work for a not-for-profit employer, you can pay off your loan with income-based payments, after 10 years or 120 payments based on your income;

b) If you make less than certain amounts, depending on the size of your family, and meet other qualifying tests, you may qualify for income-based repayment regardless of the type of employment you have, under the 25 year plan. After 25 years of reduced payments, the remainder of your loan is considered as taxable income.

The types of loans eligible:

Any Stafford, Grad PLUS or Consolidation loan made under either the Direct Loan or FFEL program is eligible for repayment under IBR, EXCEPT loans that are currently in default, parent PLUS Loans, or consolidation loans that repaid a parent PLUS Loan. The loans can be new or old, and for any type of education (undergraduate, graduate, professional, job training).

There are lots of other helpful information at the website so go and visit and explore.

Full post as published by Out of the Jungle on July 02, 2009 (boomark / email).