Source
r/StudentLoans•
stormdaemon

Explanation of lack of a cap on monthly payments for REPAYE?

Like a lot of people here I've been researching whether or not I should switch from IBR and REPAYE. One of the details I've often read about REPAYE is that there is no cap on monthly payments. However, I haven't been able to find any good explanations of how this cap is calculated, which I presume is based is of your loan amount versus your income.

Can anyone provide source or an example of how this cap would be calculated? Ideally I would like to see a comparison between how this would work between IBR and REPAYE.

Posted Jan 21, 2016, 8:20 PM UTC

36
ANGR1STExperienced Borrower•

IBR is capped at you 10 year repayment plan level. REPAY isn't. So if you make a LOT of money, REPAY requires you to pay more than the 10 year plan.

But you can switch at any time, so it's really not a problem.

3
sigmafs•

A general rule of thumb with REPAYE is you would exceed the 10 year standard payment amount when your AGI is about 1.5x your federal student deb5 level when entered REPAYE. For example, if your federal student loan debt was $100k, then your AGI would need to be $150k to exceed the 10 year standard payment amount. For IBR, it is closer to a 1:1 ratio.

3
isynergize•

We recently created a REPAYE guide with an example of those who have 10K, 30K, 50K+ in debt here: https://www.credible.com/blog/wp-content/uploads/2016/01/REPAYE-Guide.pdf?utm_source=blog&utm_medium=reddit&utm_campaign=REPAYE2015

2
DoItForTheGild•

Man... thanks for this.

1
isynergize•

Dude, no problem. The student loan struggle is real.

1
isynergize•

Yo DoItForTheGild, I saw your post on personal finance asking if you should refinance or consolidate-- check out www.credible.com. This platform allows you to compare multiple offers, from a multi-lender marketplace. See if you're overpaying on loans.

Here's some more resources -- Refinancing guide: Helps you see the difference between refinancing or consolidating student loans. https://www.credible.com/blog/wp-content/uploads/2015/12/refinance_guide_edited.pdf

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