Extended Repayment

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Mark Kantrowitz

By Mark Kantrowitz

November 22, 2019

The extended repayment plan has a fixed monthly payment amount, like the standard repayment plan, but for a longer repayment term of 12, 15, 20, 25 or 30 years.

Extended repayment reduces the monthly payment by using a longer repayment term. But, the smaller payments will increase the total payments over the repayment term by keeping the loan balance higher for longer. So, extended repayment costs more than standard repayment.

In addition, borrowers will be in debt for longer under an extended repayment plan. Borrowers who are in a 20, 25 or 30-year repayment term may still be in debt when their children enroll in college.

Generally, student loan payments are first applied to the interest that has accrued since the last payment. Then, the remainder of the loan payment is applied to the principal balance of the loan. Thus, a smaller loan payment means slower progress in paying down the principal balance of the loan.

There are two versions of extended repayment. One applies only to federal consolidation loans. The other applies to all types of federal education loans, including consolidation loans.

Use a student loan calculator to determine the monthly loan payment and total payments for both extended repayment plans.

Extended Repayment for All Federal Student Loans

This version of extended repayment provides a 25-year repayment term if the borrower has a total federal student loan balance of $30,000 or more. This repayment plan is available to new borrowers since October 7, 1998.

For example, consider a $30,000 student loan at 5% interest. The monthly payment on a 10-year repayment term is $318, with total payments of $38,183. Increasing the repayment term to 25 years reduces the monthly payment to $175, but increases the total payments to $52,612. That cuts the monthly payment almost in half (45%), but adds more than $14,000 to the cost of the loan.

Extended Repayment for Federal Consolidation Loans

The other version of extended repayment is available only for federal consolidation loans that entered repayment on or after July 1, 2006.

The repayment term for this version of extended repayment depends on the loan balance, according to this table.

Loan Balance

Repayment Term

Less than $7,500

10 years / 120 payments

$7,500 to $9,999

12 years / 144 payments

$10,000 to $19,999

15 years / 180 payments

$20,000 to $39,999

20 years / 240 payments

$40,000 to $59,999

25 years / 300 payments

$60,000 or more

30 years / 360 payments

For some unknown reason, the U.S. Department of Education web site hides information about the version of extended repayment that requires consolidation. The Department’s Repayment Estimator also doesn’t include it as an option.

If you want this version of extended repayment, you may have to cite the statute (20 USC 1078-3(c)(2)(A)) and regulations (34 CFR 682.209(e)(2) and 34 CFR 685.208(i) and (j)) to prove that it exists.

It is most useful if you have $20,000 in federal student loan debt and want a 20-year repayment term or if you have $60,000 or more in federal student loan debt and want a 30-year repayment term.

A good place to start:

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