Worried about repaying your loans?
Sep 20, 2011 by Michael Murphy | 0 Comments
"The number of borrowers defaulting on federal student loans continues to rise in Maryland and elsewhere. But even during the long and painful economic recovery, many of these defaults likely are unnecessary," the Baltimore Sun reports. "The federal government has long offered leniency for borrowers in financial hardship. But two years ago it added an income-based repayment plan that caps monthly payments based on a borrower's income and family size. 'Given income-based repayment there really is no reason why anybody should default on their loans,' says Mark Kantrowitz, publisher of FinAid.org, a website that provides student aid information. Still, he adds, 'a lot of students who could benefit from it, aren't aware of it. They default rather than calling their lender before they default to investigate their options.' Kantrowitz estimates that less than 2 percent of borrowers repaying loans are using the income-based repayment method, although as many as 10 percent would qualify."
Information on Income-Based Repayment (IBR), including an eligibility calculator, can be found at http://ibrinfo.org.