Our editorial team is independent and objective. To help support our review work, and to continue our ability to provide this content for free to our readers, we receive compensation from the companies that advertise on the CreditMashup site. This site does not include all companies or products available within the market.

We also include links to advertisers’ offers in some of our articles; these “affiliate links” may generate income for our site when you click on them. The compensation we receive from advertisers does not influence the recommendations or advice our editorial team provides in our articles or otherwise impact any of the editorial content.

While we work hard to provide accurate and up to date information that we think you will find relevant, CreditMashup does not and cannot guarantee that any information provided is complete and makes no representations or warranties in connection thereto, nor to the accuracy or applicability thereof. Here is a list of our partners who offer products that we have affiliate links for.

Manage Student Loan Debt with the Pay As You Earn Program

To meet the problem of growing student loan debt, the Department of Education offers PAYE and REPAYE Repayment Plans that reduce monthly student loan payments and forgives student loan debt after certain terms are met.
pay-as-you-earn-student-loan-debt
pay-as-you-earn-student-loan-debt

It was several years ago, under the Obama Administration, when the Department of Education began offering a more favorable version of the income-based federal student loan repayment program.

The Pay As You Earn (PAYE) program allows eligible borrowers to cap monthly payments to 10% of discretionary income, and have their loans forgiven after 20 years.

This student loan repayment program can benefit borrowers if you need to make lower monthly payments.

Key benefits of PAYE

PAYE helps keep your monthly student loan payments affordable.

  • Monthly loan payments are based on what you currently earn, not on what you owe.
  • Monthly payments under the PAYE program are capped at 10% of a borrower’s discretionary income.
  • If you make your qualifying payments for 20 years, your federal student loans can be forgiven and discharged.

How to qualify for the PAYE Repayment Program

Requirements for the PAYE Program are strict, but if you qualify it’s a good program to make student loans manageable. Borrowers that didn’t start college until after 2007, will likely qualify for the PAYE  Program.

To qualify for the PAYE repayment program, you must meet the following criteria as a borrower:

  • PAYE only applies to federal student loans that were disbursed on or after Oct. 1, 2007.
  • Have received a Direct Loan disbursement on or after October 1, 2011.
  • Prove Partial Financial Hardship as defined by the U.S. Department of Education. If the monthly amount you would be required to pay on your eligible federal student loans under a 10-year Standard Repayment Plan is higher than the monthly amount you would be required to repay under Pay As You Earn, you have a partial financial hardship.

Loans that Qualify for PAYE

Your loan must be one of the following types of federal student loans to qualify for PAYE:

  • Direct Subsidized or Unsubsidized Loans made to undergraduate student borrowers
  • Direct Plus Loans made to graduate and professional student borrowers
  • Direct Consolidation Loans that don’t include PLUS Loans made to parents.
  • Direct Plus Loans made to parents do not qualify for PAYE.

REPAYE for Borrowers enrolled earlier than 2007

Borrowers who enrolled earlier than 2007 may still be eligible through the REPAYE (Revised Pay As You Earn) Program.

The REPAYE plan was created to address federal student loan debt created prior to 2007. In Dec. 2015, the Department of Education created REPAYE as an extension of the PAYE program. REPAYE removes some of the restrictions imposed by Income-driven repayment plans.

With the REPAYE Plan:

  • Monthly payment would be capped at 10% of your discretionary income.
  • Loan forgiveness is granted after 20 years of payments for undergraduate loans, and 25 years for graduate loans.
  • Borrowers must also qualify for partial financial hardship based on the portion of their income standard repayments.
  • Must have federal direct loans.
  • Single borrowers may best benefit from the REPAYE plan. If you’re married, your spouse’s income and existing federal student loan debt are considered when determining the monthly payment. This is true even if you file taxes separately.
  • Forgiven student loans are taxable income according to the IRS. So if you qualify for student loan forgiveness under REPAYE, plan ahead and prepare for the potential tax bill.

American families are carrying about $1.6 trillion in student loan debt. The PAYE and REPAYE Repayment Plans are just some of the repayment alternatives offered to borrowers. While the repayment plans aren’t ideal, they do offer families a solution to out-of-control student loan payments.

To learn more about the “Pay As You Earn” program visit:

http://www.studentaid.ed.gov/repay-loans/understand/plans/pay-as-you-earn

Student loan refinancing to lower payments

Student loan refinancing can be an option to lower monthly student loan payments. Start your search here:

[vc_row_inner css=”.vc_custom_1547446490352{border-top-width: 1px !important;border-right-width: 1px !important;border-bottom-width: 1px !important;border-left-width: 1px !important;padding-top: 40px !important;padding-bottom: 40px !important;border-left-color: #e0e0e0 !important;border-left-style: outset !important;border-right-color: #e0e0e0 !important;border-right-style: outset !important;border-top-color: #e0e0e0 !important;border-top-style: outset !important;border-bottom-color: #e0e0e0 !important;border-bottom-style: outset !important;border-radius: 1px !important;}”][vc_column_inner width=”1/4″][vc_empty_space height=”64px”][us_single_image image=”53720″ size=”thumbnail” onclick=”custom_link” link=”url:https%3A%2F%2Fcreditmashup.com%2FPurefy||target:%20_blank|”][/vc_column_inner][vc_column_inner width=”3/4″][vc_column_text]


Refinance with Penfed!

Refinance today at fixed rates as low as 3.75% APR. Get your rate in only 2 minutes with no impact to your credit scores![/vc_column_text][vc_btn text=”Get Started” link=”url:https%3A%2F%2Fcreditmashup.com%2FPurefy||target:%20_blank|” style=”outlined” size=”20px”][/vc_column_inner][/vc_row_inner][vc_row_inner css=”.vc_custom_1547446490352{border-top-width: 1px !important;border-right-width: 1px !important;border-bottom-width: 1px !important;border-left-width: 1px !important;padding-top: 40px !important;padding-bottom: 40px !important;border-left-color: #e0e0e0 !important;border-left-style: outset !important;border-right-color: #e0e0e0 !important;border-right-style: outset !important;border-top-color: #e0e0e0 !important;border-top-style: outset !important;border-bottom-color: #e0e0e0 !important;border-bottom-style: outset !important;border-radius: 1px !important;}”][vc_column_inner width=”1/4″][vc_empty_space height=”64px”][us_single_image image=”53743″ size=”thumbnail” onclick=”custom_link” link=”url:https%3A%2F%2Fcreditmashup.com%2Flaurelroad||target:%20_blank|”][/vc_column_inner][vc_column_inner width=”3/4″][vc_column_text]

Laurel Road

Refinance today at fixed rates as low as 3.5% APR. Get your rate in only 2 minutes with no impact to your credit scores![/vc_column_text][vc_btn text=”Get Started” link=”url:https%3A%2F%2Fcreditmashup.com%2Flaurelroad||target:%20_blank|” style=”outlined” size=”20px”][/vc_column_inner][/vc_row_inner][vc_row_inner css=”.vc_custom_1547446490352{border-top-width: 1px !important;border-right-width: 1px !important;border-bottom-width: 1px !important;border-left-width: 1px !important;padding-top: 40px !important;padding-bottom: 40px !important;border-left-color: #e0e0e0 !important;border-left-style: outset !important;border-right-color: #e0e0e0 !important;border-right-style: outset !important;border-top-color: #e0e0e0 !important;border-top-style: outset !important;border-bottom-color: #e0e0e0 !important;border-bottom-style: outset !important;border-radius: 1px !important;}”][vc_column_inner width=”1/4″][vc_empty_space height=”64px”][us_single_image image=”53745″ size=”thumbnail” onclick=”custom_link” link=”url:https%3A%2F%2Fcreditmashup.com%2FCommonbond||target:%20_blank|”][/vc_column_inner][vc_column_inner width=”3/4″][vc_column_text]

Commonbond

Refinance today at fixed rates as low as 3.67% APR. Get your rate in only 2 minutes with no impact to your credit scores![/vc_column_text][vc_btn text=”Get Started” link=”url:https%3A%2F%2Fcreditmashup.com%2FCommonbond||target:%20_blank|” style=”outlined” size=”20px”][/vc_column_inner][/vc_row_inner][vc_row_inner css=”.vc_custom_1547446490352{border-top-width: 1px !important;border-right-width: 1px !important;border-bottom-width: 1px !important;border-left-width: 1px !important;padding-top: 40px !important;padding-bottom: 40px !important;border-left-color: #e0e0e0 !important;border-left-style: outset !important;border-right-color: #e0e0e0 !important;border-right-style: outset !important;border-top-color: #e0e0e0 !important;border-top-style: outset !important;border-bottom-color: #e0e0e0 !important;border-bottom-style: outset !important;border-radius: 1px !important;}”][vc_column_inner width=”1/4″][vc_empty_space height=”64px”][us_single_image image=”53738″ size=”thumbnail” onclick=”custom_link” link=”url:https%3A%2F%2Fcreditmashup.com%2Frefinance||target:%20_blank|”][/vc_column_inner][vc_column_inner width=”3/4″][vc_column_text]

Credible

Refinance today at fixed rates as low as 3.39% APR. Get your rate in only 2 minutes with no impact to your credit scores![/vc_column_text][vc_btn text=”Get Started” link=”url:https%3A%2F%2Fcreditmashup.com%2Frefinance||target:%20_blank|” style=”outlined” size=”20px”][/vc_column_inner][/vc_row_inner][vc_row_inner css=”.vc_custom_1547446490352{border-top-width: 1px !important;border-right-width: 1px !important;border-bottom-width: 1px !important;border-left-width: 1px !important;padding-top: 40px !important;padding-bottom: 40px !important;border-left-color: #e0e0e0 !important;border-left-style: outset !important;border-right-color: #e0e0e0 !important;border-right-style: outset !important;border-top-color: #e0e0e0 !important;border-top-style: outset !important;border-bottom-color: #e0e0e0 !important;border-bottom-style: outset !important;border-radius: 1px !important;}”][vc_column_inner width=”1/4″][vc_empty_space height=”64px”][us_single_image image=”53739″ size=”thumbnail” onclick=”custom_link” link=”url:https%3A%2F%2Fcreditmashup.com%2Flendkey||target:%20_blank|”][/vc_column_inner][vc_column_inner width=”3/4″][vc_column_text]

LendKey

Refinance today at fixed rates as low as 5.15% APR. Get your rate in only 2 minutes with no impact to your credit scores![/vc_column_text][vc_btn text=”Get Started” link=”url:https%3A%2F%2Fcreditmashup.com%2Flendkey||target:%20_blank|” style=”outlined” size=”20px”][/vc_column_inner][/vc_row_inner][vc_row_inner][vc_column_inner][/vc_column_inner][/vc_row_inner]

Join the family!

Get expert tips, news, and resources delivered to your inbox weekly.

You have been successfully Subscribed! Ops! Something went wrong, please try again.

Explore More

Join the family!

Get expert tips, news, and resources delivered to your inbox weekly.

You have been successfully Subscribed! Ops! Something went wrong, please try again.
Get In Touch
6080 Center Dr, 6th Fl Los Angeles, CA 90045

© 2024 All Rights Reserved.