1. Simple repayment
This plan gives you a set monthly repayment for a 10 years loan period. If you are looking forward to settle your loan as quickly as possible, you should look into this plan.
2. Extended payment
What if you have other priorities to take care of and also you can't take out so much money every month? This plan allows you to extend the repayment period to the maximum of 30 years and you will enjoy lower interest rate with this repayment plan.
It may be good to extend your payment with a lower rate of interest but when you really think of it, you are in fact paying more with this plan. This is because loan agencies need to cover back their cost (low interest rate) by increasing your loan period.
3. Graduated payment
This plan was designed to begin with lower monthly payment and increases gradually every 24 months. The graduated payment plan has the loan period of 12 -30 years as well as your minimum monthly repayment must be at least $25 or the offered rate of interest.
This plan was built for young graduates with reduce starting income. Its logic is that you will make better money as you progress in building your career. Some believe that this can be a riskier plan as you need to constantly monitor your own financial condition. Sometime you even need to do a projection for the income in the coming months. What if you choose to venture into a new market with lower pay? If you're unconfident about your future financial situation, it is best that you simply consider other repayment plans.
4. Income contingent repayment (ICR)
This plan is suitable for you for those who have a family and you are a direct loan customer. Your repayment period will be spread to 25 years and at the conclusion of the loan period, your remaining loan balance is going to be write off.
With this repayment plan, your repayment is calculated base in your total student loan, annual income and family size.
5. Earnings sensitive repayment (ISR)
This plan is similar to income contingent repayment plan with ten years loan period. However, this plan is not included within the direct loan and Federal Family Education Loan Programs (FFELP).
6. Earnings based repayment (IBR)
This payment plan is said to become initiated on July 1, 2009. And unlike the earnings sensitive repayment plan, this plan is available in the actual direct loan and FFELP. It works similar to the income contingent repayment plan with the criteria that you're pursuing a career in a lower pay market such as public service.
With this plan, you can enjoy lower monthly repayment but susceptible to a percentage of your discretionary income (your remaining income after minus from the expenses for essentials) and family size.
As you can easily see, there is more than one plan to choose from when you wish to consolidate your student loans. Your job however, is to look into the thing you need and choose the plan that is most suitable for you personally.