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PHOENIX -- Two programs could make it easier for students to repay their student loans: the Income-Based Repayment Plan and the Pay as you Earn Plan.

"The income-based repayment plan limits the amount [of your highest monthly payment] to 15 percent of your disposable income," said Mike Sullivan of the Take Charge America Credit Counseling Service. "That is very helpful."

The plan offers forgiveness after 25 years if students haven't repaid it yet. The Pay as You Earn Plan is similar, except that it's capped at 10 percent of a person's income with a 20-year forgiveness plan.

With each program, students can be taxed on any amount that you're forgiven. Students must have a partial financial hardship to be eligible for either program.

Sullivan said these plans give students some options.

"When you add these to the public service plan that's been available for a number of years, it means that there is hope now, at least for dealing with student loans," he said. "It's something that students need to be aware of and need to think about. Those who are having student loan problems need to talk with their servicer and do some research and find out if they are eligible for any of these plans."

With both the income-based and earning plans, students will pay more over time than they would for the standard 10-year plan.

You'll find a comparison of student loan repayment plans at studentaid.ed.gov.

Bob McClay, Reporter

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