How many years to repay 94K?

[SDG490]

43,000 in Stafford
51,000 in Grad PLUS

How long do people typcially get to repay these kinds/amounts of student loans? (10, 15, 20, 25, or 30 years?)

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[yadayadadude]

Who cares what's typical? What matters is:

1. How much are you making?
2. What are your other financial obligations?
3. How much do you hate being in debt?

If it were me, I'd want it gone in five years.

 

[Sol Rosenberg]

Who cares what's typical? What matters is:

1. How much are you making?
2. What are your other financial obligations?
3. How much do you hate being in debt?

If it were me, I'd want it gone in five years.

...and I'll add:

4. How much can you make of investments/savings? (difficult to determine now.) It's not that difficult to make better than 6.8%/yr for 10 years, and certainly for 30 years (long-term average return of the S&P 500 is ~13%/yr, and 30 years is getting close to "long-term") But, this assumes that you will be saving/investing the extra money that you would otherwise use to pay back your loans earlier, not spending it. Obviously 8.5% for GradPlus is a higher hurdle to jump, so you might want to pay those off faster.

Personally, so long as the interest rate is the same, I would spread the payments out as long as I could.....but aren't "standard" repayment terms 10 years? (for Stafford loans, at least -- I never looked into GradPlus)

 

[rgerwin]

Why not pay it off immediately? Depending on how much you make. I mean if you made 200K, you could pay it off in 2years if you live really cheaply. would want it gone. Especially with today's interest rates, these are not the days of letting the loans go because the interest is so low.

 

[TMP-SMX]

You want to try to at least maximize your opportunity to reduce your tax with paid interest during residency. Other than that, weigh your options.

 

[mshheaddoc]

You want to try to at least maximize your opportunity to reduce your tax with paid interest during residency. Other than that, weigh your options.

Eh, this won't help you much unless you have a bunch of other deductions. Since they cap how much you can deduct anyway.

I agree with those that said if they are lower interest take your time. People always think all debt is bad, if you are financially responsible and keep your head above water, some debt is good.

 

[rgerwin]

standard repayment terms for alot of debt is 25-30years.

 

[mshheaddoc]

standard repayment terms for alot of debt is 25-30years.

Its not standard. You have to meet certain requirements to have an extended rate.

http://www.finaid.org/loans/repayment.phtml#loanterm

Usually most people qualify with ease if its medical school debt. But I know a few people that were luckily and ended up with only $40K in debt thanks to their parents.

 

[m3unsure]

I owe about the same. ~98K (69K at 3.25%, 28K at 6.8%). My monthly payments on the higher rate loan is about $336, which comes out to little over 4K per year.

1. Better to keep hitting away at the 28K with 4K a year for the next few residency years? Or where can I invest it somewhere that earns at least the 6.8%?

2. If I start paying now, will I be eligible for forbearance when I reapply again in December? Does paying off huge sums make it harder to get it because then I would have to explain why I need forbearance if I can pay my loans somewhat? Or forbearance they don't care about?