Repayment Plans

The following repayment plans apply to Stafford, PLUS, and FFELP Consolidation Loans

The Income Based Repayment (IBR) plan bases your monthly payment on your yearly income. You must have a partial financial hardship to enroll. This plan is designed to make repaying education loans easier for students who intend to pursue jobs with lower salaries, such as careers in public service. It does this by capping the monthly payments at 15 percent of your discretionary income (the difference between your Adjusted Gross Income and 150% of the poverty guideline for your family size and state of residence). After 25 years of qualifying repayment, any remaining balance on the loan may be forgiven; however you may have to pay taxes on the amount forgiven. Additional information about IBR can be found here.

The Standard Repayment plan sets a fixed monthly payment amount that will repay the loan within a ten-year period. ACPE will establish the standard schedule for you. You will pay the least amount in total finance charges on this repayment plan.

The Temporary Payment Reduction plan will reduce your monthly payment when you experience a short-term financial hardship. Following this temporary period, your loan payments will increase so that you pay your loan off within the scheduled repayment period. This option does not bring your loan payments current.

The Reduced Payment plan gives you smaller monthly payments, plus a longer time to pay off your loan. The period of time you are making reduced payments is treated as an addition to the regular repayment term so that your payment amount at the end of the reduced payment period returns to your original payment amount. This is a good option if you need a temporary reduction in payments and do not want your payments to increase above the original scheduled amount.

The Graduated Repayment plan sets a monthly payment amount that begins with a reduced payment amount and then periodically increases over the repayment period. If you choose this option, your payment amount will be reduced for up to 24 months; however, for the remainder of the term your payment will increase. This plan is well suited for borrowers whose income starts low but will increase over time.

The Income Sensitive Repayment plan sets a monthly payment amount based on a percentage of your gross monthly income. You must renew this option annually and can extend your total repayment period by up to five years. This plan is suited to borrowers who anticipate their income to be low initially, but expect it to increase over time.

The Extended Repayment plan is available if you received your first federal loan on or after 10/07/98, and your accumulated loan balance exceeds $30,000. The maximum repayment term is 25 years. This option permanently reduces the required monthly payment amount, but you should be aware that it will result in higher finance charges over the life of the loan.

The following repayment plans apply to non-federal loans such as the Alaska Student Loan, Alaska Supplemental Education Loan, A.W. “WINN” Brindle Memorial Education Loan, the Alaska Teacher Education Loan and the Guaranteed Student Loan program.

The Standard Repayment plan sets a fixed monthly payment amount that will repay the loan within a 10-year or 15-year period based on the year in which your loan was received. ACPE will automatically establish the standard schedule for you. You will pay the least amount in finance charges on this repayment plan.

The Temporary Payment Reduction will reduce your monthly payment when you experience a short-term financial hardship. Following this temporary period, your loan payments will increase so that you pay your loan off within the scheduled repayment period. This option does not bring your loan payments current.

The Short Term Extension gives you lower monthly payments, plus a longer period to pay off your loan. The period of time you are making reduced payments is treated as an extension to the regular repayment term so that your payment amount at the end of the reduced payment period returns to your original payment amount. This is a good option if you need a temporary reduction in payments. This option is available for limited periods over the life of your loan. Renewal of this option requires compliance with previous options.

The Long Term Extension extends your repayment period for 60 months if you experience long-term financial hardship. Because you have a longer period of time to repay your loan, your monthly payments are lower. An extended term results in paying more finance charges over the life of the loan. You will be required to provide documentation of a qualifying hardship in order to be eligible for this option.

Depending on your loan type, Deferment and Forbearance may also be options.