Pay As you Earn Repayment Plan
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With a Pay-As-You-Earn student loan repayment plan, you make monthly payments toward your student loans based on your income and family size. After 20 years, the remaining balance is cancelled. If you work in the public sector then the loans are cancelled after 10 years. Qualifying for Pay As you Earn may be difficult because there are a variety of restrictions.
You must be a “new borrower” meaning that you loans were dispersed after October 1, 2007. You must also have. Pay as you earn plans are very similar to income-based-repayment plans.
Getting out of Default
Being in default of your student loans can hinder your ability to get on an extended repayment plan. The two typical options available to get out of default are a student loan consolidation and a student loan rehabilitation. Once you are out of default then you may be eligible for an Income-Based-Repayment plan.