Loan Deferment Ending

[cchoukal]

Have you heard about the new College Cost Reduction Act? Well, on
March 4, 2008 the Dept. of Education announced that as part of this
bill, Economic Hardship Deferment will be ELIMINATED as of 7/1/2009
and potentially will force repayment during residency/fellowship.


FYI: Over two-thirds of medical residents currently qualify for the
economic hardship deferment under the 20/220 pathway. The economic
hardship deferment allows medical residents to postpone repayment of
their federal educational loans during the first three years of their
residency training without the additional interest penalties of
forbearance. The Department of Education plans to eliminate this
pathway after July 1, 2009, with the start of the new income-based
repayment program.



PLEASE use the AAMC link below, it literally takes 30 seconds, and it
will send an email to your elected officials.


<http://capwiz.com/aamc/issues/alert/?alertid=11186091&PROCESS=Take+Action>

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Members don't see this ad.

 

[Pestanas]

Thanks for posting the link.....I recently found out about this and was completely shocked....the thought of having to go into repayment during my second year---after I just purchased a new home with a hefty mortgage...well....lets just say i've got a few sleepless nights ahead of me!!!

Hopefully enough people will notify their elected officials and put a stop to this.....so please everyone.....take a few seconds and write them a few words!!!

 

[Pilot Doc]

Hold your horses, chicken little.

While deferment may be eliminated, which suspends payments and accrual of interest on some loans if you're poor enough, there are no changes to forbearance, which suspends payments while interest continues to accrue.

Bottom line: You DON'T and WON'T have to pay on student loans during residency.

 

[cchoukal]

That may or may not be true. The auto-reply from my two congressman suggested that under the new law, it is possible that some residents will "fall through the cracks and enter repayment." The letters did not list specifics regarding the difference between changing deferment and changing forebearance (although, I believe Pilot Doc is correct).

That said, isn't it a little disingenuous to pass a bill called the college cost reduction act which will actually increase the cost of education? And why are they trying to keep squeezing us? I mean, sure, it's just a little more money in that now you'll have to pay interest on a larger portion of your loans, and, sure, when all is said and done, you won't really notice the cost (which is precisely why they do it), but come on! We're dying here!