Yikes.

My monthly IBR payment is $143, and the interest alone on my loans is accruing at roughly $400/month. My measly little payment does not even cover half of the interest. Is this correct/possible?

At this rate, my consolidated school loan of 76K will turn into a 100K loan in 9 years. I am praying PSLF stays around!

Hi there,

Heather’s Helper here. It is indeed possible for your IBR payment not to cover your interest. The Department of Education says that “if your IBR payment does not cover the amount of interest that accrues on your loans each month, the government will pay any unpaid, accrued interest on your subsidized loans for up to three consecutive years from the date you begin repaying the loans under IBR. (You are responsible for paying the interest that accrues on your unsubsidized loans during this 3-year
period.)”

As for PSLF staying around, there is never a guarantee but since it would take an act of Congress to get rid of it, it’s not likely that it will taken away in the near future.

Hope this helps and good luck!

-Heather’s Helper

Thank you!

Heather’s Helper - 27 September 2011 10:41 PM

The Department of Education says that “if your IBR payment does not cover the amount of interest that accrues on your loans each month, the government will pay any unpaid, accrued interest on your subsidized loans for up to three consecutive years from the date you begin repaying the loans under IBR. (You are responsible for paying the interest that accrues on your unsubsidized loans during this 3-year period.)”

I think I am a little confused.
Just to clarify, Govt will pay the rest of accrued interest up to 3 years, and then after 3yr , you are responsible, right?