cabo

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is anyone paying interest on ther staford loans while in schoo??? how does it work, do you pay monthly yearly or what??? also about how much would you say it will save you in the long run? I am getting worried about the 200K plus that I will be in debt once I graduate...

thanks for any replies.
 

Fuji

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How much it will save you depends on the amount of the loan, the interest rate, and the life of the loan. If you want to pay down the interest, you can can just send in checks at your leisure (since they aren't expected, you can send in any amount at whatever frequency you want). If you can afford it, you can pay down the principal, too.

Then again, if you can afford to pay down the interest or the principal you might be better off taking out a smaller loan and not worry about paying anything while in school.
 

Jaybe

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How much it will save you depends on the amount of the loan, the interest rate, and the life of the loan. If you want to pay down the interest, you can can just send in checks at your leisure (since they aren't expected, you can send in any amount at whatever frequency you want). If you can afford it, you can pay down the principal, too.

Then again, if you can afford to pay down the interest or the principal you might be better off taking out a smaller loan and not worry about paying anything while in school.


Paying off the interest hasn't been a priority for me over the past 6 years. There is a tax deduction for paying that interest, and as a student you are unlikely to benefit from it due to your lack of income. Having cash at your disposal at graduation will likely be a bigger priority than keeping your monthly payment $30 - $50 less by paying interest off during your four years of dental school. In my opinion, take the smallest loan you can and keep any extra cash in liquid savings for your practice transition.
 
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TucsonDDS

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What do you plan on paying the interest with? Did you get a job and are no longer living off of loans?? If that is the case then I would say definitely pay off the interest and even start paying back the principal if you can afford it. If you are living off of loans it doesn't make any sense to pay off loan interest with loan dispursments. You would actually be losing money by taking out more money than you need to live in just to pay back interest because there would be an overlap between the time that you received the dispursment and the time that you actually paid back the money.
 

ItsGavinC

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I agree with what Tucson has said. If you are taking out large amounts of loans (over150k), then paying interest back should be the least of your worries. Just plan on paying it back with the rest of the monies you owe.

If you are able to pay back interest, then you should be taking out a smaller overall loan amount.
 

I'mFillingFine

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I unfortunately overborrowed because I trusted my school's budget and filled it. But that's a whole other story...

anyhow, the only smart reason to take out some extra gov't loans is if you use it to pay off any private loans you're taking out. If you can graduate with only the public ones left, you'll be in a good place and not accruing 11% interest.
 

krabmas

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I paid back interest every year since I started school 4 years ago. This year was the first that I benifitted from the tax write off, since I am now married, so between my education credits and the write offs we actually got money back.

Even if it only saves $50 a month when I pay back my loans later it still saves something, and the less interest that gets compounded into principal when I graduate the better.

Also, If I didn't spend that money on the interest I would have wasted it on something else.
 

Lidopaine82

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I paid back interest every year since I started school 4 years ago. This year was the first that I benifitted from the tax write off, since I am now married, so between my education credits and the write offs we actually got money back.

Even if it only saves $50 a month when I pay back my loans later it still saves something, and the less interest that gets compounded into principal when I graduate the better.

Also, If I didn't spend that money on the interest I would have wasted it on something else.

so how much did that save you?
 

TucsonDDS

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I unfortunately overborrowed because I trusted my school's budget and filled it. But that's a whole other story...

anyhow, the only smart reason to take out some extra gov't loans is if you use it to pay off any private loans you're taking out. If you can graduate with only the public ones left, you'll be in a good place and not accruing 11% interest.

Very good point
 
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