28. your friend has asked you for advice in choosing the best federal student loan repayment plan for after…
28. your friend has asked you for advice in choosing the best federal student loan repayment plan for after college graduation. they told you that they have a job lined up that wont pay very much at first, but after a few years with the company their salary will increase significantly. what repayment plan would you recommend and why?
Answer
Brief Explanations:
An income - driven repayment plan would be suitable. Since the initial income is low, these plans base the monthly payment on a percentage of the borrower's income. As the income increases in the future, the payment amount will adjust accordingly, making it more manageable in the early years when funds are tight.
Answer:
An income - driven repayment plan because it adjusts to the low initial income and then to the higher future income.