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> Currently, your payments are 10% of your income above 150% of the federal poverty level. So if Chad is making about $25,000 per year (corresponding to about $
by droithomme 7y ago
> Currently, your payments are 10% of your income above 150% of the federal poverty level. So if Chad is making about $25,000 per year (corresponding to about $1,700 per month take home), his payments would be just $640 per year, or $50 per month under the current PAY-E scheme.
A $30,000 loan at 5.05% APR with $50/month payments will take infinite years to pay back. Need to be paying $127 a month to keep up with the interest, otherwise you are getting deeper and deeper in debt.
- rayiner 7y agoThe debt, including accrued interest, is forgiven after 25 years.
- lazyasciiart 7y agoIt might be. If the program still exists, and you didn't do any paperwork wrong in 25 years. And then you might owe taxes on the forgiven portion.
- rayiner 7y agoThe government could get rid of IBR, but it would be very difficult to do so retroactively. At that point, ordinary contract law principles come into play. The government’s freedom to end federal programs doesn’t free it from having to meet pre-existing contractual requirements. Even Trump’s plan and the new GOP bill only gets rid of loan forgiveness for new loans, and only 10-year public interest forgiveness program, not the 25-year forgiveness for everyone else.
- droithomme 7y agoThe federal government also promised college students in 2007 that student loans would be forgiven after 10 years of work in public service professions. Of the first 29,000 applications filed with the Department of Education to take advantage of this promise, 96 were approved. That's an approval rate of 0.33 percent.