November 23, 2014

Scrolling Headlines:

Micheletto apologizes to fans, aims to regroup following 11-1 loss -

Saturday, November 22, 2014

Vermont throttles UMass hockey 11-1 -

Saturday, November 22, 2014

UMass guard Trey Davis: ‘There’s a lot coming at me right now’ -

Saturday, November 22, 2014

UMass ‘big four’ neutralized by Notre Dame in 81-68 loss -

Saturday, November 22, 2014

UMass basketball can’t corral Grant, Irish in 81-68 loss -

Saturday, November 22, 2014

Frustration haunts Minutemen in 5-3 loss to Boston College -

Saturday, November 22, 2014

UMass hockey drops 5-3 decision to No. 12 Boston College Friday night -

Saturday, November 22, 2014

UMass hockey prepares for nationally ranked Hockey East foes BC, Vermont -

Thursday, November 20, 2014

Food scientist proposes way to improve health via breast milk -

Thursday, November 20, 2014

Miles Teller and J.K. Simmons shine in ‘Whiplash’ -

Thursday, November 20, 2014

Masculinity: A feminist’s perspective -

Thursday, November 20, 2014

UMass women’s basketball uses size and speed en route to its first win against Maine -

Thursday, November 20, 2014

Why Melissa McBride is the best actor on television -

Thursday, November 20, 2014

‘Gienie’ in a bottle: Patriots, Browns, and Seahawks highlight week 12 picks -

Thursday, November 20, 2014

UMass women’s basketball secures first victory of the season against Maine -

Thursday, November 20, 2014

Revisiting ‘The Hobbit’ trilogy as the final installment looms -

Thursday, November 20, 2014

Establishing the rules of classroom attendance -

Thursday, November 20, 2014

UMass hockey’s Troy Power reflects as his 100th career game approaches -

Thursday, November 20, 2014

Sophomore swimmer Meriza Werenski excelling in increased role -

Thursday, November 20, 2014

SGA senator plans survey on bigotry -

Wednesday, November 19, 2014

New option available to repay student debt

Flickr / DonkeyHotey

Students who borrow loans from the U.S. government to help pay for their education now have a new option when paying off their debt called the Pay As You Earn Repayment Plan, which will lower monthly federal student loan bills for eligible borrowers.

First announced by President Barack Obama in October 2011, Pay As You Earn caps payments for Federal Direct Student Loans at 10 percent of discretionary income for eligible borrowers. The U.S. Department of Education estimates that as many as 1.6 million Direct Loan borrowers could reduce their monthly payments, including teachers, nurses, first-responders and other lower-paying public service workers.

“We know many recent graduates are worried about repaying their student loans as our economy continues to recover, and now it’s easier than ever for student borrowers to lower monthly payments and stay on track,” said U.S. Secretary of Education Arne Duncan in a press release.

To qualify for Pay As You Earn, a borrower must have a partial financial hardship as defined by the U.S. Department of Education. A person has a partial financial hardship if their payments  under a 10-year Standard Repayment Plan are higher than the required payments under the Pay As You Earn plan.

A student must also be a new borrower as of October 2007 and the federal student loan debt must be high relative to the borrower’s income. The monthly payment amount is partially dependent on income and family size.

Under Pay As You Earn, a borrower may be eligible for 20-year forgiveness, which forgives any remaining student loan debt after 20 years of qualifying repayments. Furthermore, if a borrower is employed full-time by a public service organization and makes 10 years of on-time payments, they may be eligible to receive forgiveness of the remaining balance of their direct loans through the Public Service Loan Forgiveness Program. Any forgiveness of loans, though, is subject to taxation.

Because reduced payments under the plan mean repaying loans for a longer period of time, the total interest over the life of the loan will be higher than it may be under other repayment plans. However, if the monthly payment does not cover the interest that accumulates on the loans each month, the U.S. government will pay the accumulated interest for up to three years.

Ed Blaguszewski, Executive Director of News and Media Relations at UMass Amherst, said that the university fully supports Pay As You Earn and thinks that it will be helpful for students looking for a repayment plan that better suits their needs.

“Even for students that may not need 20 years, this could be helpful,” he said.

Blaguszewski said that Financial Aid Services only distributes loans, and it is the responsibility of the student to repay any loan debt left with them at the end of their education at UMass.

“We don’t say to students, do you want to repay the loan with the new plan or the old one,” he said. Blaguszewski added, though, that this new plan is something that students may want to look into.

Pat Hoff can be reached at pphoff@student.umass.edu.

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