EMERYVILLE, Calif., Dec. 20, 2017 /PRNewswire/ -- A new addition to a household can be either exciting or stressful — or both. A new person, whether a newborn or an elderly parent, usually means a bit of an upheaval. In addition to new schedules and living setups, there's the additional cost of feeding, clothing, and caring for the new human under the roof. Individuals with federal student loans, even if they are currently enrolled in an income-driven repayment plan, might worry that a new addition could compromise their ability to make their monthly payment. American Financial Benefits Center, a document preparation company that helps clients apply for and recertify enrollment in federal repayment plans, reminds clients that a change in family size means they can apply for a recalculated payment before their yearly recertification deadline.
"Help with recalculation and recertification is a big part of what we do, and we want to remind our clients that their payment can change with their family size," says Sara Molina, Manager at AFBC. "AFBC is here to make sure the paperwork correctly reflects our clients' true family size."
While there is no guarantee of a lowered payment until the recalculation is approved by the Department of Education, income-driven repayment plans are calculated based on family size and income. Therefore, borrowers whose income remains the same or lowers while their family size grows may get a lowered payment. It's important to note that family size can include a spouse, children, and any other person in the borrower's household who receives at least half their support from the borrower.
This potentially lowered payment could come as a relief for a growing or changing family. Experts estimate that the cost of care for a baby's first year of life can reach upwards of $10,000. This is not including the cost to give birth, which can vary considerably, but might be as high as $10,000. Sometimes a relative moving in means an extra hand to take care of children, defraying some of the costs of their addition to the household. However, in many cases, relatives, especially elders, need care themselves and can increase the financial responsibilities of a household.
Adding new people to the household may sometimes be unexpected, like if a relative suddenly loses their home, but others are foreseeable and a little foresight can go a long way. Saving money and making lifestyle changes in anticipation of the change may make the new mouth to feed a little less shocking on the pocketbook. For AFBC clients who still feel their monthly payment will be out of reach with a new member of the family, they can plan ahead by contacting AFBC for assistance with their application for a recalculation.
"We encourage our clients to think ahead when it comes to recalculation and recertification," says Molina, "including getting ahead of their need for new payment or a change in their family. Remember, unborn children can count in family size. Letting us know what's on the horizon just makes life easier when it comes to managing those loans."
About American Financial Benefits Center
American Financial Benefits Center is a document preparation company that helps clients apply for the federal repayment plan that fits their personal financial and student loan situation. They adhere to strict customer service guidelines and strive for the highest levels of honesty and integrity.
AFBC is a member of the Association for Student Loan Relief (AFSLR), and each representative on the phone has received the Certified Student Loan Professional certification through the International Association of Professional Debt Arbitrators (IAPDA).
To learn more about American Financial Benefits Center, please contact:
American Financial Benefits Center
1900 Powell Street #600
Emeryville, CA 94608
SOURCE American Financial Benefits Center