FiCEP Student Loan Counseling 2

Question 1

The Pay As You Earn (PAYE) repayment plan generally caps monthly payments at what percentage of a borrower's discretionary income?

Accepted Answer

10%

Answer

5%

Answer

8%

Answer

15%

Question 2

Under the Graduated Repayment Plan for federal student loans, how do monthly payments change over the repayment period?

Accepted Answer

Payments start lower and increase every two years

Answer

Payments remain fixed for the entire repayment term

Answer

Payments decrease as the borrower's income rises

Answer

Payments are recalculated annually based on income

Question 3

What is the maximum repayment term available under the Extended Repayment Plan for federal student loans?

Accepted Answer

25 years

Answer

10 years

Answer

15 years

Answer

20 years

Question 4

Under Income-Based Repayment (IBR) for borrowers who first borrowed after July 1, 2014, monthly payments are capped at what percentage of discretionary income?

Accepted Answer

10%

Answer

5%

Answer

15%

Answer

20%

Question 5

For Income-Driven Repayment (IDR) plans, 'discretionary income' is defined as the amount above what percentage of the federal poverty guideline for the borrower's family size?

Accepted Answer

150%

Answer

100%

Answer

125%

Answer

200%

Question 6

A borrower experiencing temporary financial hardship who is not yet in default may apply for which relief option to pause or reduce federal student loan payments?

Accepted Answer

Deferment or forbearance

Answer

Immediate loan cancellation

Answer

Automatic loan forgiveness

Answer

Voluntary transfer to a private lender

Question 7

Which repayment plan would a financial counselor most likely recommend to a recent graduate with variable income who wants the lowest possible payment today but expects strong income growth?

Accepted Answer

Graduated Repayment Plan

Answer

Standard Repayment Plan

Answer

Extended Fixed Repayment Plan

Answer

Income-Contingent Repayment Plan