features fixed payments made for no more than 10 years. Having the shortest repayment period, the Standard Repayment Plan saves you money over time because you’ll pay the least amount of interest over the life of the loan. The catch is that the monthly payments may be slightly higher than what you’d see under other plans.
Payments rise over time, allowing new graduates to handle student loan payments on entry-level wages upon entering the workforce.If your income doesn’t grow as expected, the higher payments toward the end of the loan repayment period may strain your finances.Extended Repayment Planallows you to extend the repayment period for up to 25 years. Monthly payments may be fixed or graduated and are generally lower than those found in the Standard Repayment Plan and Graduated Repayment Plan.
The payment for these plans is typically a set percentage of your income. Some people may qualify for no monthly payments depending on their income and family size. The repayment period for these plans varies between 20 and 25 years. After the end of the repayment period, any remaining loan balance will be forgiven by the government if your federal student loans aren’t fully repaid yet.
The REPAYE plan is good for those with high balances and a modest income. It is also a solid plan for an individual who doesn’t mind if their monthly payment is larger than what it would be under the Standard Repayment Plan since there is no cap. Additionally, for those with very large loan balances, the government subsidizes some of the interest that accrues if your monthly payment is not large enough to cover the interest payment.