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I realize there is no definitive answer and only time will tell about this program, but has anyone looked into this? As a podiatrist I'm curious to see what everyone thinks about it and am surprised not many are doing it or know about it. I have significant debt from school (more than the average med student) and have done endless research on the subject matter of IBR vs PSLF vs Forbearance etc, yet I am still unsure if PSLF is a good route, especially for podiatrists.
To those who are unfamiliar with Public Service Loan Forgiveness (PSLF), in a very brief nutshell: After 120 IBR payments (10 years) your federal loans (not private) are forgiven as long as you worked for a non-profit hospital during that time. I was told 85% of hospitals qualify and your payments during residency would count assuming your hospital is non-profit since it has residents. So that's 3 years of the 10 years done. Now 7 (or 6 if you do fellowshop) years you work for a non-profit hospital and at the end of that your loans are forgiven (ex: you work at a clinic for a non-profit hospital and recieve your paycheck through them). This sounds too good to be true and I have many concerns.
First, I just don't trust the goverment, especially when it comes to forgiving loans for doctors. The program could potentially change and it is not set in stone. It was recently started in 2007 so the first group of people being forgiven won't be till 2017. I can easily picture them changing these rules or ruling out doctors or not making those who make over a certain income ineligible for the program. And there's no guarantee you'll be grandfathered in if the rules were to suddenly change. Thus, you could be paying the minimum IBR payments for the next 10 years thinking you are going to be forgiven and if you aren't you are screwed with all the interest that built up...not to mention perhaps you could have worked for a private group making much more money yet chose a non-profit hospital in a less desirable location so you could qualify for PSLF. And another drawback to the program is you have to consolidate your loans to be eligible. Consolidation isn't always the best thing and I hadn't planned on doing it, thus if I consolidate for PSLF I might be "losing" the very low interest loans in hopes I will be forgiven.
For podiatry, PSLF could be good despite our short residency, but a doctor with a longer residency could really benefit. Let's say a doctor does his residency for 5-6 years, then does a 2-3 year fellowship after that, he would only have to work 1-2 years in a non-profit hospital and get all his federal loans forgiven! But seeing how we get a relatively low salary when compared to other physicians, this program could be great be great for those of us with significant loans.
Thoughts? If not doing PSLF how are you paying off your loans? I haven't met one person doing PSLF. Most residents I know are doing IBR, but whether they are trying to pay them back in 5 years, 10 years, or 20 years is another question I'm curious about (ex: if loans >200k would you live like a resident for the next 10 years and make aggressive payments, or live a more comfortably for 20 years and pay the minimum IBR despite the higher accumulation of interest?)
To those who are unfamiliar with Public Service Loan Forgiveness (PSLF), in a very brief nutshell: After 120 IBR payments (10 years) your federal loans (not private) are forgiven as long as you worked for a non-profit hospital during that time. I was told 85% of hospitals qualify and your payments during residency would count assuming your hospital is non-profit since it has residents. So that's 3 years of the 10 years done. Now 7 (or 6 if you do fellowshop) years you work for a non-profit hospital and at the end of that your loans are forgiven (ex: you work at a clinic for a non-profit hospital and recieve your paycheck through them). This sounds too good to be true and I have many concerns.
First, I just don't trust the goverment, especially when it comes to forgiving loans for doctors. The program could potentially change and it is not set in stone. It was recently started in 2007 so the first group of people being forgiven won't be till 2017. I can easily picture them changing these rules or ruling out doctors or not making those who make over a certain income ineligible for the program. And there's no guarantee you'll be grandfathered in if the rules were to suddenly change. Thus, you could be paying the minimum IBR payments for the next 10 years thinking you are going to be forgiven and if you aren't you are screwed with all the interest that built up...not to mention perhaps you could have worked for a private group making much more money yet chose a non-profit hospital in a less desirable location so you could qualify for PSLF. And another drawback to the program is you have to consolidate your loans to be eligible. Consolidation isn't always the best thing and I hadn't planned on doing it, thus if I consolidate for PSLF I might be "losing" the very low interest loans in hopes I will be forgiven.
For podiatry, PSLF could be good despite our short residency, but a doctor with a longer residency could really benefit. Let's say a doctor does his residency for 5-6 years, then does a 2-3 year fellowship after that, he would only have to work 1-2 years in a non-profit hospital and get all his federal loans forgiven! But seeing how we get a relatively low salary when compared to other physicians, this program could be great be great for those of us with significant loans.
Thoughts? If not doing PSLF how are you paying off your loans? I haven't met one person doing PSLF. Most residents I know are doing IBR, but whether they are trying to pay them back in 5 years, 10 years, or 20 years is another question I'm curious about (ex: if loans >200k would you live like a resident for the next 10 years and make aggressive payments, or live a more comfortably for 20 years and pay the minimum IBR despite the higher accumulation of interest?)
That is what I was told as well.
