Fillable Master Promissory Note Template Direct Plus Loans (Page 11 of 15) in pdf

William D. Ford Federal Direct Loan Program

Direct PLUS Loan Borrower's Rights and Responsibilities Statement

If you are married and file a separate federal income tax return from your

Under the ICR Plan, if your loan is not repaid in full after you have made the

spouse, only your individual adjusted gross income will be used to determine

equivalent of 25 years of qualifying monthly payments over a period of at least 25

your IBR Plan payment amount.

years, any remaining loan amount will be forgiven. You may have to pay federal

income tax on the loan amount that is forgiven.

To initially qualify for the IBR Plan, the monthly amount you would be required

Additional repayment plan information

to pay under this plan, based on your income and family size, must be less than

the amount you would have to pay under the Standard Repayment Plan.

If you are a graduate or professional student, these repayment plans will be explained

in more detail during your exit counseling session.

If you are married and file a joint federal income tax return, the loan amount we

use to determine whether you qualify for the IBR Plan will include your eligible

Under each plan, the number or amount of payments may need to be adjusted to

loans and your spouse's eligible loans. If you are married and file a separate

reflect capitalized interest and/or new loans made to you.

federal income tax return from your spouse, the loan amount we use to

If you can show to our satisfaction that the terms and conditions of the repayment

determine whether you qualify for the IBR Plan will include only your eligible

plans described above are not adequate to meet your exceptional circumstances, we

loans.

may provide you with an alternative repayment plan.

While you are repaying under the IBR Plan, you must provide documentation of

You can use the Repayment Estimator at

StudentAid.gov/Repayment-Estimator

your income and certify your family size each year so that we may recalculate

estimate your monthly and total payment amounts under the different repayment

your payment amount. If your income increases to the point that the amount

plans and to evaluate your eligibility for the PAYE and IBR plans. The calculators are

you would have to pay under the IBR Plan based on your income is more than

for informational purposes only. Your servicer will make the official determination of

what you would have to pay under the Standard Repayment Plan, you will

your payment amount and, for the PAYE and IBR plans, your eligibility for the plan.

remain on the IBR Plan, but your monthly payment will no longer be based on

You may change repayment plans at any time after you have begun repaying your

your income. Instead, your monthly payment will be what you would be

loan. However, you may not change to a different repayment plan that has a

required to pay under the Standard Repayment Plan.

maximum repayment period of less than the number of years your loan has already

Under the IBR Plan, if your loan is not repaid in full after you have made the

been in repayment, except that you may change to the REPAYE Plan, the PAYE Plan,

equivalent of 25 years (20 years if you are a new borrower) of qualifying monthly

the IBR Plan, or the ICR Plan at any time.

payments over a period of at least 25 years (20 years if you are a new borrower),

any remaining loan amount will be forgiven. You may have to pay federal

NOTE TO ENDORSER

If you are making payments on the borrower's Direct PLUS Loan, you may request a

income tax on the loan amount that is forgiven.

change of repayment plans by contacting your servicer.

Note: You are a new borrower for the IBR Plan if you have no outstanding

balance on a Direct Loan or a FFEL Program loan on July 1, 2014, or if you have

If you are making payments under any repayment plan other than the REPAYE Plan,

no outstanding balance on a Direct Loan or a FFEL Program loan on the date

the PAYE Plan, and the IBR Plan, we apply your payments in the following order:

you obtain a Direct Loan after July 1, 2014. Your servicer will determine whether

Late charges and collection costs,

Outstanding interest, and

you are a new borrower based on the information about your loans in the U.S.

Outstanding principal.

Department of Education's National Student Loan Data System.

Income Contingent Repayment Plan (ICR Plan)

If you are making payments under the REPAYE Plan, the PAYE Plan, or the IBR Plan, we

apply your payments in the following order:

Under the ICR Plan, your monthly payment amount will be either 20% of your

Outstanding interest,

discretionary income or a percentage of what you would repay under a

Late charges and collection costs, and

Standard Repayment Plan with a 12-year repayment period, whichever is less.

Outstanding principal.

Discretionary income for this plan is the difference between your adjusted gross

There is no penalty if you make loan payments before they are due, or pay more than

income and the poverty guideline amount for your state of residence and family

the amount due each month (prepayments). We apply any prepayments in

size, divided by 12.

accordance with the Act. Your servicer can provide more information about how

If you are married and file a joint federal income tax return, the income used to

prepayments are applied.

determine your ICR Plan payment amount will be the combined adjusted gross

When you have repaid a loan in full, your servicer will send you a notice telling you

income of you and your spouse. If you are married and file a separate federal

that you have paid off your loan. You should keep this notice in a safe place.

income tax return from your spouse, only your individual adjusted gross income

will be used to determine your ICR Plan payment amount. Until we obtain the

16. TRANSFER OF LOAN

information needed to calculate your monthly payment amount, your payment

We may transfer the servicing of one or all of your loans to another servicer. If there is

will equal the amount of interest that accrues monthly on your loan unless you

a change in the address to which you must send payments or direct communications,

request a forbearance.

we will notify you of the new servicer's name, address and telephone number, the

While you are repaying under the ICR Plan, you must provide documentation of

effective date of the transfer, and the date when you must begin sending payments

your income and certify your family size each year so that we may recalculate

or directing communications to that servicer. Transfer of a loan to a different servicer

your payment amount.

does not affect your rights and responsibilities under that loan.

Page 11 of 15

Master Promissory Note Template Direct Plus Loans Page 11

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