The timing of income recertification for Income-Driven Repayment (IDR) plans depends on your specific plan and recent developments in federal student loan policies. Here’s what borrowers need to know:
For Borrowers in the SAVE Plan: If you’re enrolled in the SAVE repayment plan, your income-driven renewal date may have been delayed due to ongoing litigation and the associated forbearance. It’s essential to monitor your student loan servicer account and email communications for updates on your new recertification date.
For Borrowers in Other IDR Plans: If you’re not in SAVE but in plans like Income-Based Repayment (IBR), Pay As You Earn (PAYE), or Income-Contingent Repayment (ICR), your recertification typically occurs annually around the time you first applied. Many borrowers may have recently recertified or will need to do so soon.
It is important to note, that during recertification, borrowers have the opportunity to switch repayment plans. While SAVE is still available, it may not be the best option at this time due to its uncertain future. Consider exploring other plans that align with your financial goals.
Before your recertification deadline it is crucial to understand the impact of how your updated annual income may affect your monthly payment. Recertification uses your most recent income data, which could change your monthly payment amount. This could affect your overall repayment strategy. Gaining an understanding of this prior to recertification gives you the opportunity to explore alternative repayment plans that may better align with your financial goals.
SDS tools can help you navigate this process with ease. Active subscribers can leverage the Calculator Tool to explore the second year of repayment, quickly visualizing how staying in your current plan or switching to a new one may impact your finances. The tool also allows you to revise your plans by updating income information and exploring new repayment options.
Stay proactive and informed by keeping an eye on communication from your loan servicer, and make use of SDS resources to ensure your repayment plan aligns with your financial goals for the new year.
