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PAYE vs. IBR: How these repayment plans stack up
It all depends on when you got your loan.
The Pay As You Earn (PAYE) and Income-Based Repayment (IBR) Plans are very similar — but with a few differences, depending on when you borrowed. You’ll pay less with PAYE if your loans were issued between October 2011 and July 2014. But earlier loans are ineligible for PAYE, and more recent loans get the same deal on both plans.
How these federal repayment plans compare
| Pay As You Earn (PAYE) Repayment Plan | Income-Based Repayment (IBR) Plan | |
|---|---|---|
| Best for... | Student borrowers with a high debt-to-income ratio who are either single or married and file taxes separately | Student borrowers looking for income-driven repayments on FFEL Loans that haven’t been consolidated |
| Eligible loans |
*Only qualify if consolidated with a Direct Consolidation Loan. |
*Only qualify if consolidated with a Direct Consolidation Loan. |
| How much you pay |
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| Repayment Term |
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| Eligibility requirements |
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| Eligible for forgiveness at the end of the term | ||
| Eligible for Public Service Loan Forgiveness | ||
| Required to reapply each year |
Yes |
Yes |
| Pros |
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| Cons |
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Not sure if either of these plans are right for you? Learn about your other options with our guide to student loan repayment plans.
Interested in refinancing instead? Compare your options
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