EMERYVILLE, Calif., April 26, 2018 /PRNewswire/ -- Many student loan borrowers may know about income-driven repayment plans (IDRs), which are a type of repayment plan offered to borrowers of federal student loans. Clients of American Financial Benefits Center (AFBC), a private, independent document preparation company that helps borrowers apply for and recertify their enrollment in IDRs, reminds federal borrowers that there are several kinds of IDRs available with varying requirements.
"AFBC has already helped so many borrowers successfully apply for a repayment plan that better fits their needs, but we want to let borrowers know that income-driven repayment isn't cut-and-dry," said Sara Molina, Manager at AFBC. "Borrowers have so many nuanced options when it comes to IDRs."
AFBC has already guided—and continues to guide—its clients through the ins and outs of income-driven repayment. But all federal student loan borrowers should know about the multiple plans as outlined by the Department of Education: Revised Pay As You Earn (REPAYE), Pay As You Earn (PAYE), Income-Based Repayment (IBR), and Income-Contingent Repayment (ICR). These distinct plans have different requirement for enrolling in and may result in different outcomes.
For example, REPAYE will normally require payments that are ten percent of a borrower's discretionary income. On the other hand, an IBR might require payments that are ten percent of discretionary income if the borrower took out the loan after July 2014 and might require 15 percent of discretionary income for borrowers who took out the loan prior to July 2014.
There are more differences between the plans. The length of the repayment period, for instance, differs. For REPAYE, the repayment period is 20 years if a borrower took out loans to finance an undergraduate education and 25 years if the loans were for a graduate or professional program. For IBR, the plan lasts 20 years for people who borrowed before July 2014 and 25 years for borrowers after that date.
That's just a sample of the details that divide each plan. AFBC encourages all federal student loan borrowers to read the complete details of each plan. Clients of AFBC can always contact the company with questions about income-driven plans. If clients have any questions about staying in a plan, leaving a plan, or switching to a different plan, AFBC can be a resource to clients.
"We provide service to all of our clients in the unique way to fit their specific needs, including taking into account the fine details of IDRs," said Molina. "We're happy to be a guide to help our clients navigate this sometimes complicated and confusing process."
About American Financial Benefits Center
American Financial Benefits Center is a document preparation company that helps clients apply for federal student loan repayment plans that fit their personal financial and student loan situation. Through its strict customer service guidelines, the company strives for the highest levels of honesty and integrity.
Each AFBC telephone representative 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: