Good News for Student Loan Borrowers

Two new programs available:

Lowering your Student Loan Payment through Income-Based Repayment (IBR) – A new student loan repayment plan designed to make your monthly payments more affordable. Beginning July 1, 2009.

Federal Public Service Loan Forgiveness – Remaining federal student loan debt forgiven for those who work at a qualifying public service position and make qualifying payments for 10 years.

Example based on $51,250 Debt
($10,250 X 5 terms)
Standard payment/120 months = $ 590.00
Adjusted Gross Income IBR Payment
$ 30,000 $ 170/month
$ 40,000 $ 300/month
$ 50,000 $ 420/month
$ 60,000 $ 550/month
$ 70,000 n/a

Income-Based Repayment (available July 1, 2009)
Income-based Repayment (IBR) is a new payment option for federal student loans, both undergraduate and graduate, designed to help borrowers with high debt relative to their income. Starting in July 2009,
it can help keep monthly payments affordable by calculating your
monthly payment based on your income and family size. IBR will also forgive any debt that remains after 25 years of qualifying payments.

Who Qualifies?
Borrowers who are experiencing partial financial hardship who are making payments on a Federal Subsidized or Unsubsidized Stafford Loan, Graduate PLUS Loan or Consolidation Loan made through either the FFEL or Direct Loan Program are eligible. Continued eligibility for IBR is evaluated each year.

How do I know if I have a Partial Financial Hardship?
Go to and answer the 6 questions based on your best estimate of what you’ll be earning when you start repayment.

Public Service Loan Forgiveness
Public Service Loan forgiveness will forgive remaining federal student loan debt after 10 years of qualifying loan payments and eligible employment. This program is designed for borrowers whose income is low relative to their debt.

Who Qualifies?
Public Service Loan Forgiveness is available to those who have Federal Direct Loans and who have made 120 qualifying loan payments while working full-time in a qualifying public service job. You must be making payments under the Income-Based Repayment plan (available July 1, 2009), the Income-Contingent Repayment Plan, or the Standard 10-year Repayment Plan. Only payments made after October 1, 2007 count as eligible payments toward the 120 payments.

What if I have Federal Loan through a lender (like NHHELCO, VSAC, Bank of America, Citizen’s, etc) instead of the Federal Direct Loan Program?
You will need to consolidate your loans into the Federal Direct Loan program. For more information visit or call 1-800-557-7392.

What is the definition of a Public Service Position?
A public service position is a full-time job in:

A non-profit, tax-exempt 501(c)(3) organization;
Federal, state, local or tribal government (this includes the military and public schools and colleges); or

For more information about the Public Service Loan Forgiveness Program:

Contact the Financial Aid Office at AUNE with questions.
603-283-2365 / [email protected]
The above information is based on current regulations and information compiled from, Equal Justice Works, and the National Association of Financial Aid Administrators as of April 2009.

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