8 Best Student Loan Repayment PlansHere's everything you need to know about some of the best ways to repay student loans.

For 43 million people in the U.S., repaying student loans is a fact of life. Between undergraduate and graduate student loans, Americans have amassed almost $1.3 trillion in total student debt, which is a heavy burden to carry when your career hasn’t yet gotten off the ground. For some, loan forgiveness is an option, although there are only four circumstances in which all three types of federal loans — Direct loans, Federal Family Education Loan Program loans and Perkins loans — can be forgiven. Those circumstances include college closing, disability, death and the rare case of discharge through bankruptcy.

The good news is that there are more repayment plans today than there were even a couple years ago. For those who aren’t eligible or are not seeking loan forgiveness, there are several great payment plans available for repaying student loans. Unlike private loans, federal student loan repayment programs offer a lot of flexibility for borrowers, such as pay-as-you-earn options. Figuring out which plan is best for you can be tricky, but a good starting point is to use a repayment estimator, like the one available on StudentAid.ed.gov.

The following eight loan repayment plans each have pros and cons, depending on the individual borrower’s unique set of circumstances. Learn about the details of each repayment plan so you can better decide which one is right for you.

Read: 15 Steps to Paying Off Your Student Loans

1. Standard Repayment Plan

If you don’t choose a payment plan, your loan servicer will put you on the Standard Repayment Plan, which is the default option — but you can always switch payment plans later. This plan is the best option in terms of total loan cost. The monthly payments are slightly higher, but you’ll end up paying less interest over time.

Pro: You’ll save money in the long run.
Con: Your monthly payments will be higher than other plans.
Terms: Your monthly payments will be a fixed amount of at least $50 per month and will last for up to 10 years — or 30 years for consolidation loans.

You are eligible for the Standard Repayment Plan if you have one of these loans:

  • Direct subsidized and unsubsidized loans
  • Subsidized and unsubsidized federal Stafford loans
  • All PLUS loans, which are loans that graduate students and parents of dependent undergraduate students are eligible for
  • All direct or FFEL consolidation loans

2. Graduated Repayment Plan

Student financial aid expert Mark Kantrowitz  — who is a publisher of Cappex.com, a website that connects students with scholarships — explained how the Graduated Payment Plan can help people who are facing financial hardship:

“Graduated repayment starts off with low monthly payments that are a little bit more than the interest that’s accruing on the loan, and these payments increase every two years,” Kantrowitz said. “The idea is that when you’re starting out you don’t have as much income, but over time you’ll get raises so you can afford bigger monthly payments.”

Under the Graduated Repayment Plan, you’ll make monthly payments — which will never be less than the amount of interest that accrues — for up to 10 years. Your payments also won’t be more than three times greater than any other payment plan. This is a good option for people who are just beginning careers in which they expect to earn more year after year.

Pro: Your monthly payments will start small and increase every couple years.
Con: You’ll end up paying more interest than you would through the Standard Plan.
Terms: Your monthly payments will increase over time — about every two years — and will last for up to 10 years, or 30 years for consolidation loans.

You are eligible for the Graduated Payment Plan if you have one of these loans:

  • Direct subsidized and unsubsidized loans
  • Subsidized and unsubsidized federal Stafford loans
  • All PLUS loans
  • All direct or FFEL consolidation loans

3. Extended Repayment Plan

For borrowers who can’t afford high monthly loan payments, the Extended Repayment Plan might be a viable option.

“The Extended Repayment Plan will reduce your monthly payments by stretching out the terms of the loan,” said Kantrowitz. “So if you go from a 10-year to a 20-year term, your monthly payment may go down by about a third but your interest more than doubles.”

Pro: Your monthly payments will be lower than on the Standard or Graduated Plans.
Con: You’ll end up paying more interest than you would on the Standard Plan.
Terms: You choose fixed or graduated monthly payments which will last for up to 25 years. Keep in mind that if you’re a direct loan borrower, you must have more than $30,000 in outstanding direct loans. If you’re a FFEL borrower, you must have more than $30,000 in outstanding FFEL Program loans.

You are eligible for the Extended Repayment Plan if you have one of these loans:

  • Direct subsidized and unsubsidized loans
  • Subsidized and unsubsidized federal Stafford loans
  • All PLUS loans
  • All direct or FFEL consolidation loans

4. Pay-As-You-Earn Repayment Plan

The Pay-As-You-Earn Repayment Plan is only available to people who received a federal student loan on or after Oct. 1, 2011, and had no student loans on or before Oct. 1, 2007. Applicants for PAYE must meet the minimum partial financial hardship requirement as determined by the Department of Education.

Your monthly payments are based on a number of factors, including family size and debt-to-income ratio. In fact, if that ratio is wide enough, you might not have any monthly payments. If you’re married, the incomes and loans of both spouses will be considered in the application process — but only if the couple files a joint tax return.

Pros: Your monthly payments will be lower than the above plans, and any outstanding balance on your loan will be forgiven after 20 years if you haven’t been able to repay it in full. If you qualify for the Public Service Loan Forgiveness Program, your remaining loan balance could be forgiven after 10 years of qualifying payments, rather than 20 or 25 years.
Con: You’ll end up paying more than you would on the Standard Plan, and you might have to pay income tax on any amount that is forgiven.
Terms: Your monthly payments will be 10 percent of your discretionary income but never more than the Standard Repayment Plan amount.

You are eligible for PAYE if you have one of these loans:

  • Direct subsidized and unsubsidized loans
  • Direct PLUS loans made to students
  • Direct consolidation loans that do not include direct or FFEL PLUS loans made to parents

Read: How to Pay Off Student Loans After Graduation: 9 Helpful Tips

5. Revised Pay-As-You-Earn Repayment Plan

The Revised Pay-As-You-Earn Plan is similar to PAYE except for a couple important differences, such as the absence of date requirements.

In addition, Kantrowitz said that REPAYE might not be as beneficial for married couples as PAYE because it has a marriage penalty built in; the penalty forces a couple to submit both spouse’s incomes even if they don’t file a joint tax return. “If you’re eligible for the PAYE plan, go with that one,” Kantrowitz said.

Pros: Any outstanding balance on your loan will be forgiven after 20 or 25 years if you haven’t been able to repay it in full. If you qualify for the Public Service Loan Forgiveness Program, your remaining loan balance could be forgiven after 10 years of qualifying payments, rather than 20 or 25 years.
Con: For married couples, regardless of tax filing status, both incomes as well as loan debt will be considered.
Terms: Your monthly payments will be 10 percent of your discretionary income and will be recalculated each year, based on your updated income and family size.

You are eligible for REPAYE if you have one of these loans:

  • Direct subsidized and unsubsidized loans
  • Direct PLUS loans made to students
  • Direct consolidation loans that do not include direct or FFEL PLUS loans made to parents

6. Income-Based Repayment Plan

The Income-Based Repayment Plan is ideal for people who have high debt in relation to their income. IBR requires an application like the PAYE and REPAYE plans, but differs from PAYE and REPAYE in the monthly payment amount that some borrowers would have to make.

For example, anyone who received a loan on or after July 1, 2014, would, in general, pay 10 percent of their discretionary income, which will not exceed the Standard Repayment Plan amount.

On the other hand, anyone who received a loan before July 1, 2014, would pay 15 percent of their discretionary income, which will not exceed the Standard Repayment Plan amount.

Pros: Your monthly payments will be lower and any outstanding balances on eligible loans will be forgiven after 20 or 25 years.
Cons: You’ll end up paying more over time than the Standard Repayment Plan, and you might be taxed on any loan balance that is forgiven.
Terms: Your monthly payment will never be more than the Standard Plan amount.

You are eligible for IBR if you have one of these loans:

  • Direct subsidized and unsubsidized loans
  • Subsidized and unsubsidized federal Stafford loans
  • All PLUS Loans made to students
  • Direct or FFEL consolidation loans that do not include direct or FFEL PLUS loans made to parents

7. Income-Contingent Repayment Plan

The Income-Contingent Repayment Plan is a lot like the other income-driven repayment plans, except that it gives parents access to it. Unlike PAYE, REPAYE and IBR, parents are eligible for ICR by consolidating their Parent PLUS loans into a Direct consolidation loan.

Like the PAYE program, married people do not need to include their spouse’s income as long as they do not file taxes jointly. However, if you do choose to repay your loans with your partner, then his income will be considered in the application process. Annual reviews are conducted to adjust monthly payments based on any updates in income, family size and the total amount of the Direct loans.

Pro:  Any outstanding balance on your loan will be forgiven after 25 years if you haven’t been able to repay it in full.
Cons: Your monthly payment could be more than the Standard Plan amount, and you might have to pay income tax on the amount that is forgiven.
Terms: Your monthly payments are either 20 percent of your discretionary income or the amount you’d pay on a plan with a fixed payment over 12 years, whichever is less.

You are eligible for ICR if you have one of these loans:

  • Direct subsidized and unsubsidized loans
  • Direct PLUS loans made to graduate or professional students
  • Direct consolidation loans that did not repay any PLUS loans made to parents
  • Direct consolidation loans that repaid PLUS loans made to parents

In addition, the following loans are eligible if consolidated into a Direct consolidation loan:

  • Subsidized federal Stafford loans from the FFEL program
  • Unsubsidized federal Stafford loans from the FFEL program
  • FFEL PLUS loans made to graduate or professional students
  • FFEL PLUS loans made to parents
  • FFEL consolidation loans that did not repay any PLUS loans made to parents
  • FFEL consolidation loans that repaid PLUS loans made to parents
  • Federal Perkins loans
  • Direct PLUS loans made to parents

Read: 10 Creative New Ways to Pay Off Your Student Loans

8. Income-Sensitive Repayment Plan

The Income-Sensitive Repayment Plan is unique from the other income-driven plans in that Direct loans are ineligible for this one. Like the others, monthly payments are adjusted depending on your yearly income.

Pro: This plan is suitable for low-income borrowers with FFEL Program loans.
Con: You’ll end up paying more than the Standard Plan amount.
Terms: Your monthly payments will increase or decrease based on your annual income and will last for 10 to 15 years.

You are eligible for the Income-Sensitive Repayment Plan if you have one of these loans:

  • Subsidized and unsubsidized federal Stafford loans
  • FFEL PLUS loans
  • FFEL consolidation loans

Choosing a Plan That Is Right for You

“You should always choose the repayment plan that has the highest monthly payment you can afford,” Kantrowitz said. “It may be tempting to go for the lowest possible payments, but you’ll pay for that by paying more interest over the life of the loan.”

But in the end, the best plan for you will depend on a number of factors, like current and projected income, marriage status, and short-term or long-term savings goals. Because each loan offers advantages and disadvantages based on these factors, it’s important to carefully consider your options.

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