Fillable Income-Driven Repayment Plan Request (Page 6 of 12) in pdf

SECTION 9: DEFINITIONS (CONTINUED)

A partial financial hardship is an eligibility

Eligible loans for the REPAYE plan are Direct

requirement for the IBR and PAYE plans. You have a

Loan Program loans other than: (1) a loan that is

partial financial hardship when the annual amount

in default, (2) a Direct PLUS Loan made to a parent

due on all of your eligible loans (or, if you are also

borrower, or (3) a Direct Consolidation Loan that

required to provide documentation of your spouse's

repaid a Direct or Federal PLUS Loan made to a

income, the annual amount due on all of your eligible

parent borrower. FFEL Program Loans, Federal

loans and your spouse's eligible loans) exceeds 10%

Perkins Loans, HEAL loans or other health

(for the PAYE plan and for new borrowers under the

education loans, and private education loans are

IBR plan) or 15% (for those who are not new

not eligible to be repaid under the REPAYE plan.

borrowers under the IBR plan) of the amount by which

DEFINITIONS FOR THE PAYE PLAN:

your adjusted gross income (AGI) exceeds 150% of the

The Pay As You Earn (PAYE) plan is a

annual poverty guideline amount for your family size

repayment plan with monthly payments that are

and state of residence. The annual amount due is

generally equal to 10% of your discretionary

calculated based on the greater of (1) the total

income, divided by 12, but will never be more

amount owed on eligible loans at the time those loans

than what you would have paid under the

initially entered repayment, or (2) the total amount

standard repayment plan with a 10-year

owed on eligible loans at the time you initially request

repayment period based on what you owed when

the PAYE or IBR plan. The annual amount due is

you entered the PAYE plan.

calculated using a standard repayment plan with a 10-

year repayment period, regardless of loan type. When

Discretionary income for the PAYE plan is the

determining whether you have a partial financial

amount by which your adjusted gross income

hardship for the PAYE plan, the Department will

exceeds 150% of the poverty guideline amount for

include any FFEL Program loans that you have into

your state of residence and family size. To initially

account even though those loans are not eligible to be

qualify for PAYE and to continue making payments

repaid under the PAYE plan, except for: (1) a FFEL

based on your income under this plan, you must

Program loan that is in default, (2) a Federal PLUS

have a partial financial hardship (see definition). If

Loan made to a parent borrower, or (3) a Federal

you are married and file a joint federal income tax

Consolidation Loan that repaid a Federal or Direct

return, your AGI includes your spouse's income.

PLUS Loan made to a parent borrower.

Eligible loans for the PAYE plan are Direct

The standard repayment plan has a fixed monthly

Loan Program loans received by a new borrower

payment amount over a repayment period of up to 10

other than: (1) a loan that is in default, (2) a Direct

years for loans other than Direct or Federal

PLUS Loan made to a parent borrower, or (3) a

Consolidation Loans, or up to 30 years for Direct and

Direct Consolidation Loan that repaid a Direct or

Federal Consolidation Loans.

Federal PLUS Loan made to a parent borrower.

FFEL Program Loans, Federal Perkins Loans, HEAL

DEFINITIONS FOR THE REPAYE PLAN:

loans or other health education loans, and private

The Revised Pay As You Earn (REPAYE) plan is a

education loans are not eligible to be repaid under

repayment plan with monthly payments that are generally

the PAYE plan.

equal to 10% of your discretionary income, divided by 12.

You are a new borrower for the PAYE plan if:

Discretionary income for the REPAYE plan is the

(1) you have no outstanding balance on a Direct

amount by which your adjusted gross income exceeds

Loan or FFEL Program loan as of October 1, 2007

150% of the poverty guideline amount for your state

or have no outstanding balance on a Direct Loan

of residence and family size. If you are married, your

or FFEL Program loan when you obtain a new loan

AGI generally includes your spouse's income

on or after October 1, 2007, and (2) you receive a

regardless of how you file your federal income tax

disbursement of a Direct Subsidized Loan, Direct

return.

Unsubsidized Loan, or a Direct PLUS Loan made to

a student borrower on or after October 1, 2011,

or you receive a Direct Consolidation Loan based

on an application received on or after October 1,

2011. However, you are not considered a new

borrower if the Direct Consolidation Loan you

receive repays loans that would make you

ineligible under part (1) of this definition.

Page 6 of 12

Income-Driven Repayment Plan Request Page 6

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