Pulling Yourself Up by Your Bootstraps is No Windfall: IBR Makes the American Dream Possible
A new report examines Income-Based Repayment (IBR) and the effect of pending changes to the program and analyzes how IBR affects borrowers over time as their incomes change. The New America Foundation released “Safety Net or Windfall: Examining Changes to Income-Based Repayment for Federal Student Loans” by Jason Delisle and Alex Holt, arguing that changes to Income-Based Repayment (IBR) should be better targeted towards low-income borrowers rather than “high-income borrowers with graduate and professional degrees.” …
Student Loan Default Rates Rise, Income-Based Repayment Can Help
The Department of Education just released statistics showing that student loan defaults rose to an average of 13.4 percent last year, with 22.7 percent default rates for students who attended for-profit colleges. But the data we have on student loan default rates isn't anywhere close to complete. Meet the “Cohort Default Rate,” that measures only those defaults that occur soon after a student loan borrower begins repaying his or her loans. At least the cohort has recently been expanded to include…
IBR Goes Digital!
An Electronic Income-Based Repayment (IBR) Application is now available and only 27 months after IBR came on line! If you qualify for Income-Based Repayment, your required monthly payment will be capped at an amount that is intended to be affordable based on your income and family size, and will be less than what you would have to pay under a 10-year Standard Repayment Plan. Why consider IBR? Well, assuming that you are not a Kardashian or heir to the Five Guys Burgers & Fries™ dynasty (I like cheese, jalepenos, mushrooms…
New Student Loan Regulations Introduce ICR-A
The Department of Education today published proposed regulations implementing a better, faster, and stronger repayment option for student loan borrowers. Formerly known as President Obama’s Pay As You Earn initiative, it shall now be known by the absurdly non-descriptive name of ICR-A. [sigh] In spite of the stupid name, the new repayment option ROCKS (if you can get it…) There is fine print of course, but here’s the gist: Annual payments are capped at 10 percent of “discretionary income” (IBR’s…
Video: Breaking Down Federal Student Loan Repayment
In this recent webinar hosted by my friends at iGrad, I break down each federal student loan repayment plan, so that borrowers can understand what choices they can make and the pros and cons of each available option. Recorded on March 27, 2012
