What are the different types of student loan repayment plans?

Student loan repayment plans vary depending on the type of loan and the state in which the loans were acquired. In Kansas, the most common student loan repayment plans are Standard Repayment, Graduated Repayment, Extended Repayment, Income-Based Repayment plans, and Pay As You Earn (PAYE). Standard Repayment Plans are the most common option. This plan sets repayment terms at a fixed monthly payment for a specific loan duration, usually 10 years or less. Payments under this plan never increase and the debt is paid off in the shortest amount of time. Graduated Repayment Plans allow borrowers to start their payments small and increase gradually over time. This plan is beneficial for those who plan to earn more money as their careers progress. Extended Repayment Plans lower the monthly repayment amount by extending it over a longer period of time, usually up to 25 years, depending on the amount of the loan and the amount of the borrower’s debt. Income-Based Repayment Plans reduce the monthly repayment amount based on the borrower’s income and family size. The repayment amount will be adjusted each year based on the borrower’s income and loan balance. Pay As You Earn (PAYE) is similar to Income-Based Repayment; the repayment amount is adjusted annually based on the borrower’s income and loan balance. However, the borrower’s payments will never exceed 10% of their discretionary income. These are the most common types of student loan repayment plans available in Kansas. Depending on the loan and the borrower’s circumstances, there may be other repayment options available. It is important to speak with a loan advisor to ensure you select the repayment plan that best fits your individual needs.

What are the different types of student loan repayment plans?

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