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The Income Based Repayment Program for Student Loans (IBR)


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Advantages of the Income Based Student Loan Repayment Program
The Income Based Student Loan Repayment Program (IBR) offers a number of key benefits to graduates struggling to repay their student loans. While these benefits are sizable, a borrower must also be sure to consider the disadvantages.

IBR Benefit #1 - Lower Monthly Payments
The IBR program may substantially lower a graduate's monthly student loan payment. The calculation of the actual amount is based on a formula that considers the student's adjusted gross income level, the Federal poverty line, and the number of people the graduate financially supports.

To estimate what your student loan payment would be under the Income Based Repayment program (IBR), visit the Department of Education's online IBR calculator.

IBR Benefit #2 - Student Loan Forgiveness
Under the Income Based Repayment program, balances not paid off after either 10 or 25 years are forgiven by Department of Education. While all borrowers can qualify for student loan forgiveness after 25 years, the 10-year forgiveness feature is reserved for those who have worked full-time in public service.

IBR Benefit #3 - Student Loan Interest Subsidy
If your newly calculated IBR payment doesn't cover the interest that is added to your subsidized Stafford loan, the government will pay the difference for your first three years in the IBR program. After that, the unpaid interest is added to your loan balance.

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