As of July 1, 2009, a new income-based student loan repayment program (IBR) will allow most federal student loan borrowers with economic hardships to repay their loans based on a formula that takes income and total indebtedness into account. The government will cancel any remaining balances after twenty-five years of repayment.
The program should bring much-needed relief to borrowers having trouble with student loan repayment. However, unless changes are made, IBR is not likely to reach many of the neediest borrowers. This paper presents recommendations to extend IBR to all who need it.