Hampshire College

Parents have several repayment plans from which to choose to repay their PLUS loans: the standard, the extended, the graduated, and the income-sensitive repayment plan.

Note that the information listed below pertains to both a PLUS loan borrowed through a private lender and a Direct PLUS loan borrowed through the federal government unless otherwise specified.

The STANDARD REPAYMENT plan is a ten year plan. The minimum monthly payment is $50. Borrowers are initially given the standard plan, but may request a different plan.

The EXTENDED REPAYMENT plan allows for an increased length of time to pay off the loan. If you have borrowed a total of $30,000 or more in PLUS loans from the same lender, you can request to pay off the loans over 25 years. This will lower the monthly payments, but increase the total interest paid. Remember that you may pay extra on your loans, as there is no pre-payment penalty. This will help in paying off the loan sooner and reducing total interest paid.

If you would like an extended repayment plan to reduce your monthly payments, but do not have $30,000 or more in loans, consider consolidating your PLUS loans. Consolidation loan repayment terms range from 12 to 30 years depending on the amount borrowed.

The GRADUATED REPAYMENT plan is for ten years, but the payments in the first few years start out low and increase over time. The graduated period is usually during the time when the student is enrolled. During this time the monthly payment is usually only the interest charged, making the monthly payments much less than the standard plan. Once the interest only period has ended, the monthly payments must increase significantly in order to pay off the amount borrowed in the short period of time remaining on the loan.

The INCOME-SENSITIVE REPAYMENT plan allows borrowers to pay a smaller monthly payment for a period of time. This plan uses the borrower's income to help determine the lower payment amounts. The repayment period is ten years, so the payments need to increase over time to pay off the loan within the ten years. This plan is available only to PLUS loans borrowed through a private lender and not the Direct PLUS loan.

Note that some of the features of each repayment plan may vary among the various lenders and servicers. To know what your specific options are, please contact your loan servicer.