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Understanding Obama Student Loan Forgiveness Program and Direct Loan Programs The Obama Student Loan Forgiveness Program is officially known as the William D. Ford Direct Loan Program which created Direct Loan Program reforms applying to federal loans. Beginning in 2014, federal loan borrowers qualified for payments basing on ten percent of their discretionary income. The money collected are primarily intended to increase college funding and for funding poor and minority students. Private lending companies no longer receive subsidies from the federal government for federally backed loans. There are a lot of benefits that federal loan borrowers can enjoy through Obama Loan Forgiveness, wherein they have had the opportunity to consolidate all loans into a single loan, taking advantage of affordable repayment plan. The Direct Loan Program is offering several repayment plans such as graduated repayment, income based (IBR), standard repayment, income contingent (ICR), pay as you earn (PAYE), and revised pay-as-you-earn (REPAYE). In terms of graduated repayment plan, payments are lower as compared to the standard repayment plan but are increased every two years, and thereafter. When it comes to an income-based repayment plan, borrowers are made to pay according to their income and the family size, wherein borrowers are expected to pay fifteen percent of their discretionary income and can enjoy as low as $0 a month. In a standard repayment plan, borrowers pay a fixed amount each month until the loan is paid, and the amount of payment usually depends on the loan term, amount, and the interest rate. An income contingent repayment plan (ICR) is made basing on the borrowed amount, borrower’s income, interest rate, loan balance, and family size, and borrowers can also enjoy as low as $0 a month. Although the requirements are more difficult than other repayment plans, Pay As You Earn (PAYE) has the lowest monthly repayment plan that is based on the borrower’s annual income, using the ten percent discretionary income. Revised Pay As You Earn (REPAYE) was made to give a substantial relief to many federal loan borrowers who did not meet the strict qualifications of Pay As You Earn (PAYE). You may qualify for Direct Loan Program if you are working in the public sector after a period of ten years unlike twenty to twenty-five years for standard loan forgiveness program. Allow us to help you find the best repayment loan program for you, feel free to visit us n our homepage or website. Repayment of loans is really challenging and frustrating at the same time most especially if you are on a very tight budget, but keeping on a budget and choosing the right repayment plan will greatly benefit you. We are always ready to assist you with all of your questions and concerns, feel free to check us out, and we’ll help you out!Why not learn more about Loan?

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