An income driven repayment plan is an option for students where they are able to pay a specific portion of their income towards their student loans. The student loans are also supposed to be forgiven after a set amount of time or number of payments. However, this ultimately depends on the amount of your loans principal, the interest rate and your income over time. As of September 2021, only 32 borrowers have ever had their loans discharged through an income driven repayment plan.
- Income driven repayment forgiveness typically lowers your monthly payment but the forgiveness aspect depends on your principal and interest rate.
- As of September 2021, only 32 borrowers had ever gotten discharge through the income driven repayment plan.
- Forgiveness isn’t achievable for most borrowers due to the maximum amount of debt a student can take on to qualify.
“The amount forgiven is added to your total taxable income, which would increase the amount you owe the government.”