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Maine VolunteerFare

The College Cost Reduction & Access Act and AmeriCorps

Published September 9, 2008

The College Cost Reduction and Access Act of 2007, ("CCRAA") includes two new programs that may provide significant benefits to AmeriCorps members and AmeriCorps alumni. It includes a new Public Service Loan Forgiveness Program ("PSLF") for recipients of William D. Ford Direct and Direct Consolidation Loans and a new Income-Based Repayment Plan (IBR).

The Public Service Loan Forgiveness Program offers forgiveness for outstanding Federal Direct loans for those individuals who make 120 qualifying payments after October 1, 2007, while working full-time in a public service job. According to the Department of Education’s proposed regulations, full-time service in an approved AmeriCorps position will be considered equivalent to employment in a public service job. Based on this definition, full-time service in AmeriCorps State and National, VISTA, and NCCC are considered public service jobs for the purposes of PSLF.

The CCRAA also added a new Income-Based Repayment Plan for individuals with a partial financial hardship. The new IBR plan helps to make repaying education loans more affordable for low-income borrowers, such as an AmeriCorps member living on a stipend. Under IBR, your monthly payments could be as low as $0 each month while serving in AmeriCorps. Even a payment of $0 a month counts towards the required 120 payments for PSLF. The IBR calculator can help you estimate your monthly payments and let you know whether you qualify.

Please visit the Department of Education’s website for more information about Public Service Loan Forgiveness or Income Based Repayment.