Article 10/2/14 Good Information: What happens if you default on your student loans

[Lesley]

http://lifehacker.com/what-really-happens-if-you-default-on-your-student-loan-1641197706


Obviously, this does not apply to those in good standing in loan repayment programs, but the information in this article is succinct and clear for those in danger of default.

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[sazerac]

Does anybody know the truth of the following statement I saw in the comments section? This is the first I'd head of it:

"I don't think it was mentioned, but if you default on your students loans in acquiring a medical degree, you can be excluded from providing (and billing for) medical services to patients with federal and state funded insurance plans - Medicare, Medicaid, Tricare, ChampVA, Federal Blue Cross, etc. - pretty big deal if you want to practice medicine in the United States."

 

[DrMidlife]

Truth, apparently.

Strongly biased article: http://thinkprogress.org/health/2013/05/20/2037561/government-doctors-default-student-loans/

...which links to strongly biased analysis through a paywalled link: http://www.modernhealthcare.com/art...lMDVva2d3YytteWJHZUU0akNYWm85ZStYYzJoUkE9PQ==

 

[user3]

Does anybody know the truth of the following statement I saw in the comments section? This is the first I'd head of it:

"I don't think it was mentioned, but if you default on your students loans in acquiring a medical degree, you can be excluded from providing (and billing for) medical services to patients with federal and state funded insurance plans - Medicare, Medicaid, Tricare, ChampVA, Federal Blue Cross, etc. - pretty big deal if you want to practice medicine in the United States."

Also, professional licenses can be revoked. Which seems counterproductive...if one defaults and then isn't able to work, how will they repay?

 

[DrMidlife]

The license revocation is a disincentive to default. Defaulting when you have a six figure salary and IBR/PAYE/etc is a choice. This policy is supposed to keep you from choosing it. The loan servicers get louder and louder with their warnings to not default, the closer you get to default. Big bold text, then red text, then phone calls, etc. So if you spend about a year ignoring warnings and not making payments and not communicating, that's when losing your Medicare privileges and licensing becomes one of your many problems.