How to Apply for Income-Driven Repayment: A Step-by-Step Guide for Medical Students and Residents

Income-Based Repayment (IDR) sounds complicated but after you understand what to do and what you need to prepare, the application process is quite simple. This guide covers everything. We also explain what to do if you begin residency for the first time, change your plans, or retake certification after your first year.

Before You Apply: What You'll Need

You will need three things to apply:

FSA ID. That is your login information for both FAFSA and studentaid.gov. If you can't remember it you can reset it via fsaid.ed.gov before applying.
Recent tax returns or income documents. You can have your tax data pulled directly from IRS if you grant permission. You can also enter income by hand. For residents you need a W2 from your residency program.
Information of your spouse (if you are married). Your spouse's income will be taken into account if you file jointly. Income of your spouse becomes relevant if you file separately.

Step 1: Log Into studentaid.gov

Go to studentaid.gov and log in with your FSA ID. Once logged in go directly to Manage Loans and look for the Request for Income Driven Repayment Plan option at studentaid.gov.

Step 2: View Your Current Loans

The portal shows all your federal loans: Direct Loans for Subsidized and unsubsidized students and PLUS loans for graduate students as well as any other. Double check that all loans are listed. Sometimes they do not show up because of different servicing companies (such as MOHELA, Nelnet, AIDVANTAGE etc). You might need to contact that company directly separately. Remember that only federal loans are eligible for IDR; private loans do not qualify.

Step 3: Choose Your IDR Plan

You will be asked which plan you prefer. Options include SAVE, PAYE, IBR and ICR. Most medical students and residents typically pick:

SAVE usually results in lowest monthly payments.
PAYE is worth considering if you want forgiveness 20 years later (instead of 25 for grad loans) and you are eligible.
IBR is the fallback if you do not qualify for PAYE.

Not sure which plan to pick? Choose "I want lowest monthly payments." System will then calculate based on eligible plans and you can compare before final selection.

Step 4: Provide Income Information

You need to verify your income. You have two options:

Option A: IRS Data Retrieval Tool (recommended) You can apply and request permission to retrieve your last return directly from IRS. This is faster and more accurate than manually entering numbers. If your last two returns were filed recently, this data will be ready to use.

Option B: Manual Entry Did your income change significantly since your last return? (Common for new residents just starting a residency.) Enter your income yourself and provide supporting documentation. Residents typically upload pay stubs or letters from program confirming salary. New residents: If previous return shows very low income ($0) because you were a student, use current income from residency. Using an offer letter or first stub serves as proof and greatly reduces payment compared to income from previous job or fellowship.

Step 5: Complete Spousal Information (If Applicable)

If you file jointly as married couples income of your spouse will be counted. The application will ask for separate income information from them. If you file separately then income of your spouse does not figure into the calculation of IDR. Consider tax consequences of filing separately beforehand: weigh savings on IDR payments against the cost of paying taxes.

Step 6: Review and Submit

Before submitting your application you will see summary of projected monthly payment for each plan to which you qualify. Carefully review these numbers. The amount shown is what you start paying after processing your application. If this amount seems larger than expected check whether:

Correct income has been used (residency salary not previous income)
Family size has been entered correctly (each dependent lowers your payment)
All loans have been included correctly

Step 7: Confirm With Your Loan Servicer

Once you submit your application at studentaid.gov your lender will process and adjust your payment schedule. This usually takes about one to four weeks. During processing some loans will be put into administrative deferment meaning that you won't be required to pay until the new plan goes into effect.

Follow up with your service to double check:

The new amount that you will pay each month.
When the payment is due.
All of your loans are definitely now on the new plan.

Service provider contact information is also provided with your loan information on studentaid.gov.

Annual Recertification: Don't Miss This

IDR plans require annual recertification. Each year you resubmit income information to keep it active. Servicers send reminders but they count on them. Missing this recertification results in monthly payments increasing to standard level after 10 years of repayment. Any unpaid interest will be capitalized. For borrowers under PSLF those who have unpaid months ineligible can't count toward 120 payments. Set a reminder 60 days before the deadline for recertification. The process is the same as applying for the first time: log into studentaid.gov and submit income data again.

Switching Plans Mid-Repayment

You can switch between PAYE and SAVE whenever you wish by filling in a new application. However there are important points to consider:

Switching from SAVE to PAYE or IBR is generally straightforward but going back from PAYE or IBR to SAVE often comes with restrictions based on loan type and the time you borrowed.
Interest that has not been paid builds up whenever you change plans; subsidy for interest does not transfer over to other plans.

If you are thinking about switching you should first check the numbers. You should be sure that savings in payments are worth the interest that has accumulated.

What to Do If You're Pursuing PSLF

If you want to use Public Service Loan Forgiveness (PSLF) if you have Income Driven Repayment (IDR), you need to do two steps besides just signing up. First you must submit annually Employment Certification Forms (ECF) at studentaid.gov/pslf each year. This confirms your employer qualifies and that you are making payments that count. If you don't submit this, you won't know whether you are on track for PSLF.

You need to make sure all loans are Direct loans. PSLF applies only to Direct loans but if you have FFEL loans (older loans from before 2010), you must consolidate those into Direct Consolidation Loans to make them PSLF eligible; this resets the count of qualifying payments so be sure timing is right if you have some qualifying months already.

Currently MOHELA is the service provider for PSLF; all processing related to PSLF goes through MOHELA; if your loans are with a different servicer they will transfer to MOHELA once you submit ECF; this is normal.

A Note on the Current SAVE Litigation

By 2025 SAVE is under an administrative forbearance order as a result of pending litigation. Borrowers who signed up for SAVE are not required to make active payments during this pending litigation. If you are pursuing PSLF check if months of this forbearance count toward qualifying payments. Changes in policy may affect your qualifying count.

Do you want to see your estimated IDR payment before you apply? Use MedDebt's calculator at https://www.medschooldebtcalculator.com/calculator to see estimated monthly payments for SAVE, PAYE and IBR and use actual family size and salary before committing to any plan.

Sources include information from Federal Student Aid about application process for Income Driven Repayment (IDR); regulations for SAVE plan; requirements for PSLF and Certification Form from Department of Education.