The feds do not ‘cover’ anything on the IBR loans, just allows for the payments to be highly reduce and the part not paid to accrue to year 20 or beyond, and then discharged (but taxable if discharged) If the loan payment was $400 per month but IBR allows it to be capped at $100, no one is paying that $300, it just keeps getting deferred. The payment amount is recalculated every year, so as the grad earns more, the payment is increased, but will it ever get back to what the original payment was scheduled to be? It is still a LOT of money being deferred along the way. As the grad earns more, he could have more exclusions from income too, more dependents, mortgage, state taxes.
If NY is only paying the IBR scheduled payment for new grads making under $50k, it is not going to be a lot. I just think of all that interest accruing.
I don’t know why the program would be limited to just the Stafford loans. Perkins, plus, etc are all federal loans, and the description is federal loans. Also, some students borrow much more that the $27000, as they go to undergrad for more than 4 years, or go to grad school and take out more Stafford loans. I think the limit is more like $52k?