Paying Off Student Loans Calculator

Repayment Calculators

A repayment option plans out how much loan and interest you pay for an allotted time. Remember that the average time to pay off student loans take about ten to twenty-five years with these in mind: the time of application; interest; financial need; funding; and the policies of the financial service office of your school of attendance. A repayment plan is a scheme on how to pay off student loans according to your needs. Pick payment scheme want depending on your student loan: Standard Repayment, Extended Repayment, Graduated Repayment, Income Based Repayment, Income Contingent Repayment, and ISRP.

Standard Repayment allows you to pay a constant amount every month until your student loans are fully-paid. You will make monthly payments until ten years of at least $50 until you complete your loans. The twelve-month payment may be higher since you will be paying it in the quickest possible time. For a ten-year payment, you pay the least interest.

Extended Repayment allows you to pay a constant annual or accumulated payment amount in a period not exceeding 25 years. The fixed monthly payment for your loan is lower than the standard but you will eventually pay more because of interest accrued in the 25-year repayment period. This plan is good for the borrower if he needs pay in smaller amounts in a longer period of time with the added interest.

In a Graduated Repayment, you start paying your loan in lower amounts that increase bi-annually up to the period of ten years. It is good if you expect an increase in your income over an amount of time. The monthly payment you spend will never be lower than the total interest that accumulates between payments. Even if the monthly payment eventually increases over time, no single payment will be higher than thrice other payments.

In Income Based Repayment, the needed monthly payment is dependent on family size and corresponding income. A borrower is qualified for IBR if regular payment amount under the IBR is of lesser amount than the monthly payment computed in a 10-year payment scheme. If the IBR is repaid for twenty-fiveyears and you meet other criteria, you have the balance of your loans cancelled. Also, if the borrower renders public service and has a reduced load payment scheme via this repayment option, your ten-year remaining balance could be cancelled.

Income Contingent Repayment makes Direct Loans obligations more flexible with your family's gross income in mind (this includes your income added to your wife/husband's income, when married), number of member in the family, and the amount total of the Direct Loans. Your maximum repayment period for this plan is 25 years. In ICR, you pay each month minus: the payment sum you will have to pay if your loan is repaid in 12 years times the income percentage factor proportional with the annual income; twenty percent of your family's monthly income. The unsettled amount add to the capital once each year if payments are not enough to cover interest accrued on the corresponding loan,. But, this will not exceed ten percent of the amount owed originally upon entering payment. Interest will still accrue but it will not be capitalized to the loan as principal. If loans have not been repaid after the maximum period of 25 years, the unpaid portion is discharged. Taxes may be paid in exchange of the amount discharged

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Income-Sensitive Repayment helps FFEL borrowers can avail of a monthly loan payment based on their yearly income. As the borrower's income changes - increases or decreases - the amount in which you pay also increases or decreases. Your maximum repayment period for this plan is 10 years.

Calculating Interest

To calculate for the interest to be paid each month, we use the Simple Daily Interest Formula, which is: Number of days since last payment x Principal balance outstanding x Interest rate factor = Interest amount. The interest rate factor calculates interest accrued on the loan. It is calculated by dividing the interest rate by 365.25 (as in the 365 ¼ days of the year). Since interest accumulates over a daily basis on the loan, it is important to consider: number of days between the last payment, amount of loan balance, interest rate and how it accumulates each month.