Using IBR or PAYE plans for US student loans while settled abroad

Hello everyone, I have a US student loan question. After a few years of having to defer my loans due to a low salary, my monthly payments have skyrocketed to £450 a month, which I have to start paying back in a few months. At 30% of my monthly salary, it is simply unsustainable for me to pay this amount on top of my other bills (including expensive London transportation and hopefully a possible mortgage in the near future), especially as it will increase over the upcoming years. Has anyone been able to pay their loans back under the Income-Based Repayment Plan (IBR Plan) or Pay As You Earn Repayment Plan while living in the UK? Can anyone perhaps provide some clarity on the benefits/disadvantages of each plan? I plan to call my loan providers soon, but I am worried that settled expats may be discounted from these repayment plans.

PAYE has lower payments than IBR, but not everyone qualifies for PAYE. it all depends on when you started taking out student loans. Not sure of the exact dates to make you eligible though. It's really just a matter of applying under the appropriate plan. They'll use your tax info to determine your monthly payments, so make sure you file your taxes in the US. If you're married here, file married filing single so that they only consider your income and not your partner's as well. It should make your payments much lower and you can always pay more than required to get through it faster if you feel like you can afford it.

Yes, you can apply for IBR (income based repayment) while living in the UK, that's what I've been doing since last January and I'm about to renew my payment plan.


On IBR you have to send in paperwork every year so they can assess what amount your payments should be. I don't know about your loan provider, but mine was really great about discussing what payment plan was best for me.

(edit cause I can't type today, damn migraine)

Thanks for your responses! I'm with Sallie Mae/Navient, I am filling out the 1040 EZ and 2555 EZ forms now.

Hey City of Villages, are your Sallie Mae/Navient loans federal loans that were privately backed, or were they straight up Sallie Mae loans?

I ask because I'm paying $650/month to Navient for my old sallie mae loans, and would be thrilled to figure out some sort of repayment option...

You know, back when I took out these loans, in 2004/2005, it seemed like there'd be a golden job waiting at the end. Too bad about the economy.

They were just regular old Sallie Mae loans. May be able to do Income based repayment, but I have to file my taxes first.