Why am I not eligible for the PAYE repayment plan?
PAYE or Pay As You Earn is one of the federal student loans income based repayment plans. You must be a new borrower to qualify for the PAYE plan.
Q. from Pennsylvania, $15.9K in student loans debt
Q. has graduated from college back in 2009. She uses MoneyCompass to track her debt status and optimize it when possible. She noticed that she wasn't offered the PAYE plan, and wondered why.
Each repayment plan has its own eligibility conditions, the PAYE eligibility states that in order to qualify you must be a new borrower. This means:
You must have had no outstanding balance on a Direct Loan or FFEL Program loan when you received a Direct Loan or FFEL Program loan on or after Oct. 1, 2007
You must have received a disbursement of a Direct Loan on or after Oct. 1, 2011
Since Q's situation doesn't meet these criterias, the PAYE plan isn't right for her.
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