The federal standard student loan repayment plan for Direct Loans and Federal Family Education Loan is based on the borrower’s balance (rather than the borrower’s income or other factors). These balance-based plans are fixed and made for up to 10 years (between 10 and 30 years for consolidation loans).
Federal student loan borrowers have options on which repayment plan to choose. The standard balance-based repayment plan is the default plan that the loan servicer will put the borrower in unless the borrower applies and is approved for a different plan.
The graduated balance-based plan starts with lower payments that increase every two years for up to 10 years (between 10 and 30 years for consolidation loans).
Eligible Federal Loans
The following loans from the Direct Loan Program and the FFEL Program are eligible for the Graduated Repayment Plan:
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Direct PLUS Loans
- Direct Consolidation Loans
- Subsidized Federal Stafford Loans
- Unsubsidized Federal Stafford Loans
- FFEL PLUS Loans
- FFEL Consolidation Loans
Monthly Payments
For Federal Education Loans (excluding Consolidation Loans), the borrowers’ monthly payments start out low and increase every two years for up to 10 years. Payments will never be less than the amount of interest that accrues between payments and won’t be more than three times greater than any other payment.
Monthly Payments for Consolidation Loans
Monthly payments start out low and increase every two years for a period of between 10 and 30 years for Direct Consolidation Loans and FFEL Consolidation Loans. The payments will never be less than the amount of interest that accrues between payments and won’t be more than three times greater than any other payment.
If the borrower has a Direct Consolidation Loan or FFEL Consolidation Loan, the length of the repayment period will depend on the amount of total education loan indebtedness. This total education loan indebtedness includes the amount of the consolidation loan and the other student loan debt. Other student loan debt includes any federal student loans that are not included in the consolidation loan, as well as private education loans that are not eligible for consolidation. The maximum amount of other student loan debt that may be considered in determining the repayment period may not exceed the loan amount being consolidated.
The chart below shows the maximum repayment period for a Direct Consolidation Loan or FFEL Consolidation Loan under the Graduated Repayment Plan depending on total education loan indebtedness.
| If the Total Education Loan Indebtedness is… | The Repayment Period will b | |
| At Least | Less Than | |
| $7,500 | 10 years | |
| $7,500 | $10,000 | 12 years |
| $10,000 | $20,000 | 15 years |
| $20,000 | $40,000 | 20 years |
| $40,000 | $60,000 | 25 years |
| $60,000 | 30 years |