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January 30, 2013

Student Loans and “The Tax Man”

Started getting those tax docments arriving in the mail?  Remember that the income-driven repayment plans (like Income-Based Repayment and Pay As You Earn) limit a borrower's student loan payments to an affordable level given his or her income.  Monthly payments are determined based on the borrower’s Adjusted Gross Income (AGI) and family size. To maximize the allowable reductions or adjustments from your total income: • Save for retirement.  The best way to boost your adjustments is to save for retirement.  Try…

January 7, 2013

Pay As You Earn is even hotter than Income-Based Repayment

President Obama’s new Pay As You Earn (PAYE) repayment option is yummy.  Thank you, Mr. President!   Except, um, lots of us don’t qualify for PAYE and will have to settle for its somewhat less attractive (but still good looking) older sibling--Income-Based Repayment (IBR). Here’s a short list of some of the similarities and differences between Pay As You Earn and Income-Based Repayment: Only “new borrowers” are eligible to choose Pay As You Earn Only federal Direct Loans are eligible for repayment under Pay…

By Heather  |  Category:  Pay As You Earn, IBR  

December 6, 2012

Pay As You Earn Implementation Set for December 21, 2012!

This just in!  The Department of Education will announce on Friday, December 7th, that the eagerly anticipated Pay as You Earn repayment plan will be implemented beginning December 21, 2012.

By Heather  |  Category:  Pay As You Earn  

November 1, 2012

Introducing the New “Pay As You Earn” Student Loan Repayment Plan

Final regulations implementing the President's “Pay As You Earn” repayment initiative have just been published.  The regulations provide for reduced payments for some federal student loan borrowers and improve the federal student loan disability discharge process.   Highlights include:  Eligible borrowers: Must not owe a balance on a federal loan as of October 1, 2007; AND Must receive a disbursement of a federal loan after October 1, 2011. Payments will be 10% of discretionary income with forgiveness after 20 years…

By Heather  |  Category:  Pay As You Earn, Student Loan Repayment  

July 17, 2012

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…

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