Student loans and Income Based Repayment (IBR)

[holidaymama]

Has anyone used it? Does it really bring down your loans significantly?

My husband is looking for a principal jobs and will have a nice pay raise of around 15-30k. I would like to stay home or maybe work part time when that happens but currently we pay about $570/month for student loans which is a huge chunk.

I'm just wondering if anyone has any experience with this program. Thanks!

[gabbyraja]

I did it. Before getting back in school. Our income had been cut to 1/3 after I started to SAH. We were so broke we quickly qualified for food stamps, so take that income into consideration, but my payment became ZERO. So, yes, it can greatly reduce your payment. :) However, I'm pretty sure you continue to accrue interest, so that's something to consider.

[Super~Single~Mama]

I will be using it. Do some looking, if your FG is doing public interest work (which has a broad definition) he may qualify for loan forgiveness after 120 payments under income based repayment.

Also, if you do IBR for 25 years loans are forgiven. But, you only qualify for IBR if your payment under the guidelines is less than the standard payment rate. It's definitely worth looking into, but if he has privately consolidated his loans he may not qualify.

[holidaymama]

We both have federal student loans. Each of about $32k. I am hoping he can fin a job for about $60k which would allow me to stay home if we brought those loans way down and found an inexpensive house.

[MidwifeErika]

My payments went from nearly $500/mo to zero. Thank goodness! We were drowning. 

[MariesMama]

I was on IBR for a while and my payments were zero.  The process was very simple.

[34me]

We did IBR for my dh's.  He graduated in 1996 so YMMV.  The payment went down significantly.  But, as a pp stated interest still accrued i believe.  The payments bumped up some every couple of years so that we still paid them off in 10 years.  The process for getting it done was just a phone call.

[iowaorganic]

I am on it and my payment is zero.  If you go to your lenders website they should have information on it- like what your payment would be based on your income and family size.  It is very very simple to apply and even simpler to renew.  Since I am self employed I just send in a copy of my tax return every year.  Yeah- my interest keeps accruing- but mine is set at 3%- so it isn't something that I am worrying about right now.

[OhMyHzzle]

I just signed up for it. My payments have gone from $700 something down to $130/mo. Much easier to handle since I will be unable to return to working in my field for a while. We were hit head on by an idiot and my engine block landed on my ankle. Sucks when that happens to people, but especially for me since I am an exercise physiologist and now on top of injury I am unable to work Dr said for 18 to 24 months. Idiot had no insurance either, we have uninsured motorists insurance but for the 3 children & I we're just about at the limit with the medical costs. When DHs loans go into repayment in Feb 2013 (he should finish his PhD in August) we plan to use the IBR for him as well.