Repository navigation
The standard plan's $50 minimum applies once to a borrower, but Direct and Parent PLUS payments each apply it (34 CFR 685.208(b)(1)(ii)) #10567
Description
Follow-up to #10415, which added the separate Parent PLUS payment.
What the model does
standard_repayment_payment and parent_plus_standard_repayment_payment each compute min_(max_(amortized_payment, p.minimum_payment), balance) on their own balance. A borrower who holds both loan types on the standard plan gets two $50 minimums, one in each variable.
What the law says
34 CFR 685.208(b)(1) gives one standard plan to Direct Subsidized, Direct Unsubsidized and Direct PLUS borrowers. Paragraph (b)(1)(i) has a borrower repay "a loan in full within ten years from the date the loan entered repayment", and (b)(1)(ii) sets the minimum on the borrower: "A borrower's payments under this repayment plan are at least $50 per month". So the Department of Education sets one minimum on all of a borrower's standard plan payments.
Hand-computed case
One single filer in Ohio in 2026, with $50,000 of wages and all loans at 6%. I ran this at f679eedd, and computed the last column as min(max(.0111021 × total balance, $50), total balance), using the 120-month factor .005 / (1 − 1.005^−120).
| Direct | Parent PLUS | standard_repayment_payment |
parent_plus_standard_repayment_payment |
Sum | One $50 minimum |
|---|---|---|---|---|---|
| $1,000 | $20,000 | $50.00 | $222.04 | $272.04 | $233.14 |
| $1,000 | $1,000 | $50.00 | $50.00 | $100.00 | $50.00 |
| $5,000 | $5,000 | $55.51 | $55.51 | $111.02 | $111.02 |
The sum and the single minimum agree in the last row, where both amortized payments exceed $50. At 6%, the gap opens when either positive balance falls below about $4,504.
Possible fix
Parent PLUS loans can't use RAP, IBR, PAYE or SAVE (34 CFR 685.209), so a borrower on one of those plans still owes parent_plus_standard_repayment_payment with its own minimum. One fix keeps both variables and adds a person-level total for a borrower with both loan types on the standard plan: min_(max_(direct_amortized + parent_plus_amortized, minimum), direct_balance + parent_plus_balance), with the same new-loan gate.
Activity