Big changes are coming to federal student loan repayment options

Answer: 

Two: Standard Repayment Plan or Repayment Assistance Plan (RAP)

Questions: 

• What would you need to know about these repayment options before you chose the best one for you?
• What does a borrower gain, and what might they give up, when many plans are narrowed down to two?

• What is the tradeoff between paying a loan off quickly and keeping the monthly payment low?

Click here for the ready-to-go slides for this Question of the Day that you can use in your classroom. 

Behind the Numbers: (CNBC)

The Repayment Assistance Plan, or RAP, is the U.S. Department of Education’s latest income-driven repayment plan, or IDR, meaning it sets borrowers’ monthly bills at a share of their income. The other new option is the Tiered Standard Plan, which includes fixed payments spread over several different timelines, based on a borrower’s total debt.

About the Author

Dave Martin

Dave joins NGPF with 15 years of teaching experience in math and computer science. After joining the New York City Teaching Fellows program and earning a Master's degree in Education from Pace University, his teaching career has taken him to New York, New Jersey and a summer in the north of Ghana. Dave firmly believes that financial literacy is vital to creating well-rounded students that are prepared for a complex and highly competitive world. During what free time two young daughters will allow, Dave enjoys video games, Dungeons & Dragons, cooking, gardening, and taking naps.

More posts by Dave