REPAYE: What is it and Who Does it Help?
It’s the Revised Pay as You Earn Plan (REPAYE). Enacted in December of 2015, this program is designed to expand one of the most beneficial Income-Driven Repayment Plans, the PAYE, to borrowers with older loans that were previously not eligible for PAYE.
This is actually a great program with individuals that have a high income, but high debt.
What are the Payment and Forgiveness Aspects of this Program?
- It caps your payment at 10% of your monthly income
- It forgives any unpaid loan balance at the end of the loan term
- For those with only undergraduate loans, this is 20 years
- For those with graduate school loans, this is 25 years
What is different about this program from other Income-Driven Repayment Plans?
- Improved Interest Rate benefit
- Regardless of tax filing status, a married couple’s full income is taken into account in determining payment (under older IBR plans, then if a husband and wife filed taxes separately, only the individual’s income would be considered in determining the payment amount)