IBR and EM. Let's chat loans...

[WildMed16]

My med school loans are coming out of grace period this week (some of them already have) . Not happy about it...

I've debated going into forbearance just to have a little extra cash. Barely staying afloat as is. I'd rather be making some payments now though to save $ in the long run.

So it seems that IBR is probably ideal for now. My understanding is that loans are forgiven if steady payments are made over a 10 year span and I work for a non profit or government agency.

My question is what percentage of EM jobs are considered to be non profit? Anyone else look into this?

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[Old_Mil]

My question is what percentage of EM jobs are considered to be non profit? Anyone else look into this?

I haven't seen a comprehensive list, but there are very few. For starters you have to be an employee of the nonprofit, so that takes all the IC and local group jobs off the table. This is mainly for the FM guys who end up working in the government's community health centers. I'm not sure if being an employee of a nonprofit catholic hospital would count, I remember that some of the rules were changed a few months ago to exclude religious employees from loan forgiveness.

Here's a link to FAQ about the public service loan forgiveness program.

 

[Azapaza]

I think If you are an employee for a NF profit hospital you can do it. Problem is we make too much money and so the calculations add up to the same amount, based on 10 years of repayment. If you do the IBR for your 3 or 4 years of residency you could save some money at the end.

I graduate this year, did not do IBR in residency (couldn't afford), and have decided I am better off consolidating and paying it off at my own pace, with loan repayment as part of my contract.

 

[Mechanic]

I dug around with this too a few months ago.

http://forums.studentdoctor.net/showthread.php?t=900862


In the end I wasn't able to find much concrete to post here. But I will be doing IBR. There is going to be a fat chance that you'll find you a job that will get you the PLSF after 10 years. It seems to make more sense if you are in residency with long post-graduate training. IBR only makes sense to me for now that I prefer not to go into total forbearance so that I can start building more credit rating with scheduled payments knowing the amount I'm paying is barely scratching the interest, not to even think about the principal. (run-on sentence but tired right now )

 

[Glitterbox]

So fellowships count towards the PSLF too right?

 

[danzman]

Went to a lecture on this. Essentially, the IBR process is the only thing that makes sense for me. There are still jobs in less than desirable locations that you can be a not for profit employee, and with the trend of less physician owned practices, I could see a future where there are even more jobs. Also, the trouble with all of this is that, if you owe a large amount (>200K), the monthly payments would crush a single residents salary in a standard repayment plan. If you defer, you are doing nothing with the loans and they just collect interest. Also, even if you decide to change your mind and switch over to paying more, you didn't really lose anything by doing IBR (instead of deferment). This thing all comes down to how much you owe. <100K and IBR might be a bad idea >200 and it seems to be the only real choice. The perfect situation would be to pay the loans off now but that would require either a lower total debt amount, or a SO that had a large income. Fellowships do count towards the total repayment, not that it helps us that much.

I really don't see any other option for a person who has a large debt burden and no other sources of income.

 

[danzman]

I think If you are an employee for a NF profit hospital you can do it. Problem is we make too much money and so the calculations add up to the same amount, based on 10 years of repayment. If you do the IBR for your 3 or 4 years of residency you could save some money at the end.

I graduate this year, did not do IBR in residency (couldn't afford), and have decided I am better off consolidating and paying it off at my own pace, with loan repayment as part of my contract.

What are the rates on consolidation that we are talking about, and approx how much debt?

 

[WildMed16]

I haven't seen a comprehensive list, but there are very few. For starters you have to be an employee of the nonprofit, so that takes all the IC and local group jobs off the table. This is mainly for the FM guys who end up working in the government's community health centers.

I don't think that's true. I'm pretty sure my mega tertiary care hospital is a NP. I'll ask some of the attendings, but I had assumed there were a lot of EM jobs out there at non profit hospitals.

 

[SeekerOfTheTree]

Most places with a residency program are typically 501 status.

 

[The White Coat Investor]

Don't confuse IBR and PSLF. IBR helps you keep payments low during residency, but the loans are still growing due to the ridiculously high rates being charged to grad students. You don't get loans forgiven until year 20-25 with IBR. Most docs will have their loans paid off long before then. The 10 year forgiveness is through PSLF. A 3 year residency at a 501c, a 3 year fellowship there, and 4 years as an attending could result in forgiveness of hundreds of thousands of dollars though.

But there is only one situation in my town that would lead to PSLF at 10 years- being an academic doc at the local university. The VA here is staffed by a private, contracted group and the local 501C hospital also contracts with a private group.

If I had loans today, I'd probably IBR them through residency, then continue living like a resident for 3-4 years while making hefty payments on them.

 

[Cynic]

I don't think that's true. I'm pretty sure my mega tertiary care hospital is a NP. I'll ask some of the attendings, but I had assumed there were a lot of EM jobs out there at non profit hospitals.

There's often some confusion about this. A lot, if not most, hospitals are 501c3 aka not for profit. It's more a tax code than a corporate philosophy, but that doesn't matter...I mention it only because in medical school I don't think a lot of people realized that.

Getting more to the point at hand, just because the emergency physicians work in a not-for-profit hospital, does not mean they work for the hospital. They are usually groups which are their own partnership or company that are hired by the hospital to run the ED, as described by the previous poster (local and national groups)

If you are hired on by the hospital itself, as opposed to whatever group staffs the ED, it will still likely be as an independent contractor (IC), where you have to basically have a CPA set up an S-Corp or LLC for you. This is so that you are basically your own business, hired by the hospital.

Among other things, this allows the hospital isolated liability from the practice of the emergency physicians in it's ED.

Typically academic hospitals are both 501c3 and have directly hired on ED physicians as employees. The compensation is usually not as lucrative in academia as in the community, thus if you see yourself going into this type of practice environment, doing IBR in residency, your possible fellowship, and then making the regular standard minimum payments for however many more years to total 120 months of consecutive payments that you work in academia might make sense...you would have an opportunity to have some of your loan balances forgiven.

As my moniker would suggest, though, I'm trying to talk residents out of counting on the government making good on the loan forgiveness promise a decade or whenever from now...nonetheless it would behoove us all to try to make some sort of dent in our loans through residency, and IBR is one of a couple ways to do that.

 

[thorg12]

So I'm a third yr resident that is going to be working next yr as clinical faculty at a residency program. The retirement plan is 403b so I assume it qualifies for pslf? I've already paid about 2 yrs of ibr under direct loans and plan on continuing next yr. I was originally planning to pay off are 300k plus in 6 years but since I'm going to a job that might qualify I figure I should try the pslf thing out. I hate having this debt that's why I wanted to pay it off fast but if I save at least 2, and prob more, yrs of big monthly payments(2 yrs ibr during residency and the 2 yrs I save at the end of 10yr plan) that's at least 80k.
What do you guys think? And how do I make sure my job qualifies; the people you talk to on the phone are usually less than helpful.
Thanks

 

[WildMed16]

There's often some confusion about this. A lot, if not most, hospitals are 501c3 aka not for profit. It's more a tax code than a corporate philosophy, but that doesn't matter...I mention it only because in medical school I don't think a lot of people realized that.

Getting more to the point at hand, just because the emergency physicians work in a not-for-profit hospital, does not mean they work for the hospital. They are usually groups which are their own partnership or company that are hired by the hospital to run the ED, as described by the previous poster (local and national groups)

If you are hired on by the hospital itself, as opposed to whatever group staffs the ED, it will still likely be as an independent contractor (IC), where you have to basically have a CPA set up an S-Corp or LLC for you. This is so that you are basically your own business, hired by the hospital.

Among other things, this allows the hospital isolated liability from the practice of the emergency physicians in it's ED.

Typically academic hospitals are both 501c3 and have directly hired on ED physicians as employees. The compensation is usually not as lucrative in academia as in the community, thus if you see yourself going into this type of practice environment, doing IBR in residency, your possible fellowship, and then making the regular standard minimum payments for however many more years to total 120 months of consecutive payments that you work in academia might make sense...you would have an opportunity to have some of your loan balances forgiven.

As my moniker would suggest, though, I'm trying to talk residents out of counting on the government making good on the loan forgiveness promise a decade or whenever from now...nonetheless it would behoove us all to try to make some sort of dent in our loans through residency, and IBR is one of a couple ways to do that.

Ah gotcha. Thanks for the clarification. Well put.

 

[Cynic]

So I'm a third yr resident that is going to be working next yr as clinical faculty at a residency program. The retirement plan is 403b so I assume it qualifies for pslf? I've already paid about 2 yrs of ibr under direct loans and plan on continuing next yr. I was originally planning to pay off are 300k plus in 6 years but since I'm going to a job that might qualify I figure I should try the pslf thing out. I hate having this debt that's why I wanted to pay it off fast but if I save at least 2, and prob more, yrs of big monthly payments(2 yrs ibr during residency and the 2 yrs I save at the end of 10yr plan) that's at least 80k.
What do you guys think? And how do I make sure my job qualifies; the people you talk to on the phone are usually less than helpful.
Thanks

See below:

http://studentaid.ed.gov/repay-loans/forgiveness-cancellation/charts/public-service


Instructions for completing form

Employment certification Form

 

[Cynic]

It's also worth at least looking at GL adviser. They do a lot of marketing at ACEP, AAEM, EMRA and they advocate that it works, and will do an analysis for you as well.

 

[WildMed16]

It's also worth at least looking at GL adviser. They do a lot of marketing at ACEP, AAEM, EMRA and they advocate that it works, and will do an analysis for you as well.

Kind of was looking for something like that. Trying to figure out what works best. Anyone use these guys? Like a lot of docs unfortunately, I'm allergic to these types of money matters. I'd rather have someone else do an analysis for me.

 

[thorg12]

Thanks for the forms. I really appreciate it

 

[AmoryBlaine]

I looked into this a while back since my job would technically qualify (academic nonprofit).

Basically PSLF (as I understand it) is for people who have debt to income ratios where they would never be able to pay off their loans. Like someone who racks up $120k in debt getting an MA in social work and then gets a job for $29k.

That would be like someone with a typical EM salary (let's say 250k) having $1M in educational debt.

Your payment would basically be half your takehome for 10+ years.

PSLF allows you to make IBR for 10 years and then get forgiven, so for the SW it would be a great deal. For the ER doc, if you have the income they are going to get the payment, by the end of the term you would be getting hit really hard and probably have paid off most of the debt anyway.

It may be a good idea if your debt load is relatively high and you do IBR during residency/fellowship. Even then though you might have higher payments than you want coming out of residency.

For anyone reading this, I have found managing my student loans (which are about equal to one year's gross salary) surprisingly easy. I wish I wasn't paying them off, but I don't wish I was a trader or an attorney.

 

[Postictal Raiden]

I looked into this a while back since my job would technically qualify (academic nonprofit).

Basically PSLF (as I understand it) is for people who have debt to income ratios where they would never be able to pay off their loans. Like someone who racks up $120k in debt getting an MA in social work and then gets a job for $29k.

That would be like someone with a typical EM salary (let's say 250k) having $1M in educational debt.

Your payment would basically be half your takehome for 10+ years.

PSLF allows you to make IBR for 10 years and then get forgiven, so for the SW it would be a great deal. For the ER doc, if you have the income they are going to get the payment, by the end of the term you would be getting hit really hard and probably have paid off most of the debt anyway.

It may be a good idea if your debt load is relatively high and you do IBR during residency/fellowship. Even then though you might have higher payments than you want coming out of residency.

For anyone reading this, I have found managing my student loans (which are about equal to one year's gross salary) surprisingly easy. I wish I wasn't paying them off, but I don't wish I was a trader or an attorney.

great to know.

On the other hand, I'm estimating to graduate with near 400K debt (about twice as much as the average physician's salary).

 

[AmoryBlaine]

great to know.

On the other hand, I'm estimating to graduate with near 400K debt (about twice as much as the average physician's salary).

I would keep an eye on PSLF as a possibility then. Esp if you can swing making payments during residency/fellowship.

There are plenty of specialties/jobs in medicine where you can make 400k. People on SDN tend (not this forum) tend to act like we are all working for $100k/yr and should thank our lucky stars just to be able to touch patients.

 

[sylvanthus]

Kind of was looking for something like that. Trying to figure out what works best. Anyone use these guys? Like a lot of docs unfortunately, I'm allergic to these types of money matters. I'd rather have someone else do an analysis for me.

One of the guys from GL advisor is calling me tomorrow about my loans. If youd like I could let ya know how it goes.

 

[SeekerOfTheTree]

Dude that would be awesome for all of us.

 

[tkim]

One of the guys from GL advisor is calling me tomorrow about my loans. If youd like I could let ya know how it goes.

He/she'll most likely tell you things you could look up on your own, then try to sell you $450 'help' which simply involves sending you non-prefilled forms for you to sign. At least that's how it was couple years ago.

There was a thread on it couple years ago.

 

[dally1025]

For those of you that haven't graduated yet stop by your financial aid office. They were able to give me some (free) personalized advice.

 

[sylvanthus]

He/she'll most likely tell you things you could look up on your own, then try to sell you $450 'help' which simply involves sending you non-prefilled forms for you to sign. At least that's how it was couple years ago.

There was a thread on it couple years ago.

Hmm well they didnt call me. Pretty awesome. Ill look into it myself after match day. Thanks.