July 8, 2020 at 9:09 pm #70230
Hi. I’m wondering if NACA will also accept a Pay as you earn payment plan for student loans? This option for me is less than then IBR plan but I haven’t seen anything regarding using anything other than an IBR ( Income-based repayment) plan. Thanks!July 8, 2020 at 9:37 pm #70231jasmine1103Participant
I believe IBR onlyJuly 8, 2020 at 10:04 pm #70232
Oh that hurts. Would you or someone else here happen to know if I need to get a separate estimate from the studentaid.gov website for both my wife and I? We are in deferment and I was told on a webinar that we can use the estimate from the studentaid.gov website. I was hoping someone can tell me how that works. My MC hasn’t responded to me.July 9, 2020 at 8:19 am #70236jasmine1103Participant
You will have to call your lender and ask for the escalation department and that you are applying for a loan and you need the repayment amounts for each loan individually for both of youJuly 9, 2020 at 11:37 am #70245
We can accept any verified payment plan as long as it reflects a payment other than zero. I’m still looking for my notes to see if there’s anything specific to be aware of, but the only thing we are really concerned with is that it be a non-zero amount.
Online Operations, NACA
email@example.comJuly 9, 2020 at 1:48 pm #70260
Thanks for the reply @TTrumble . So to clarify, I can use a Pay As You Earn(PAYE) plan instead of an Income-Based Repayment (IBR). Both plans are options on the Studentaid.gov website when I get an estimate.July 9, 2020 at 2:13 pm #70262nitromilesParticipant
@coquipr79 Yes you should be able to; I believe you just need an official letter from your loan servicer of what your actual payments will be under the plan.
The acronyms get confusing but the PAYE and IBR plans are just two of the four types of Income-Driven Repayment (IDR) plans that are available. I just think “IBR” gets used interchangeably to describe all the various types of plans as opposed to IDR. The various ones just have different limits as far as caps (some cap at 10% of your income, some at 15%), loan types that qualify, and whether or not they add your spouse’s income to the calculations. For me it was opposite of your case: my payments under an IBR are much less than the PAYE plan due to the fact they don’t use my wife’s income in the calculations (at least that’s what Great Lakes told me).July 10, 2020 at 12:51 pm #70285October 29, 2020 at 9:08 am #72458
Is there anywhere in the NACA workbook that specifically shows what type of payment plans are accepted for student loans? Some of the counselors are not accepting REPAYE, not $0, according to some members in the FB group.October 29, 2020 at 9:36 am #72459NelsontMember
Page 33 of the workbook details what types of plans are OK. Specific situations will only be discussed with your MC. The bottom line is you can’t have a zero payment. Even if you have a repayment plan that is considered acceptable according to the workbook if your current pay is zero that will not work.
If that is the case then you need to do as described in the above post and tell your loan servicer to provide a letter of what your payment would be hypothetically if you had to start paying today.
If there is still an issue then you need to have your MC clearly explain in detail exactly what is acceptable and why your situation is not.October 29, 2020 at 10:45 am #72460
Thank you Nelson for pointing this out. Now, I’m curious if NACA is using the correct verbiage for their student loans. The program itself is called Income Driven Repayment Plans, and there are 4 main types of income driven repayment plan ie PAYE (only applicable when there is hardship that caused reduced income and must be new borrower), REPAYE (no hardship but it takes 10% of your discretionary income), IBR (for older loans and takes 15% of your discretionary income), ICR (20% of discretionary income). Technically, REPAYE is what gives the lowest possible payments for borrowers.October 29, 2020 at 11:51 am #72466
Exactly! IBR and IDR are confused a lot, and by reading the description in the workbook it looks like they are talking about IDR. We are currently on REPAYE. Due to the government mandate, our credit report shows 0 payment but I was able to obtain a letter from my servicer that’s not $0 payment and what would’ve been my payment after the forebearance. Unfortunately we are not eligible for IBR because it would’ve been more than our standard payment plan.October 29, 2020 at 6:16 pm #72476
The bottom line is that all four types of plans are in fact based in some manner on your income. They are all therefore income-based repayment plans, so the IBR moniker is in fact used to refer to all four types. It doesn’t matter which one you are in, you just have to show a non-zero payment amount.
Any counselor not accepting REPAYE is incorrect, and you should have them contact our in-house helpline or consult with their regional director if they need further clarification.
Online Operations, NACAApril 10, 2021 at 2:42 pm #74968iaj0313Participant
@Ttrumble it looks like you updated this forum recently (it says 22 hours ago) with information for the REPAYE plan. To confirm, you’re saying that no version (0$ or an amount other than $0) under the REPAYE plan is acceptable? So the guidance for individuals who are under this plan is to agree to a different payment plan that potentially imposes a higher monthly student loan payment in order to qualify with the lender? If this is accurate, are there any other repayment plans that are also “barred”? Or is there any other advice for people under REPAYE to qualify? Thanks for your helpApril 11, 2021 at 3:20 am #74974RBJ619Participant
Can you explain the reasoning behind this decision? My husband and I are both in deferment due to the pandemic, but payments will restart in October and we are both on REPAYE plans that we have been on for a while. Does this mean we will have to sign up for new loan repayment plans? I would just like to understand why NACA would make such a drastic decision, as the REPAYE plan is one of the most affordable Income Driven student loan repayment options. It uses 10% of your discretionary income as opposed to 15% under the Income Based repayment plan and 20% under the Income Contingent repayment plan? We would not qualify for the PAYE plan as that is strictly for new borrowers. I really hope this won’t be a set back for us on our homebuying journey.
Thanks for any insight you can give us.
- You must be logged in to reply to this topic.