Today the Department of Education announced the new Pay As You Earn Repayment Plan.
In order to qualify you must have a partial financial hardship and meet the following requirements:
“You must be a new borrower as of Oct. 1, 2007, and must have received a disbursement of a Direct Loan on or after Oct. 1, 2011. You are a new borrower if you had no outstanding balance on a Direct Loan or FFEL Program loan as of Oct. 1, 2007, or had no outstanding balance on a Direct Loan or FFEL Program loan when you received a new loan on or after Oct. 1, 2007. ”
The Pay-As-You-Earn plan caps federal student loan borrowers’ loan payments at 10% of the discretionary income and the remaining loan balance will be forgiven after making 20 years of payments.
The Pay As You Earn plan will be available to borrowers by the end of 2012.
Please see details at the Department of Education’s website: studentaid.ed.gov