Loan Repayment

[justDOit22]

Just curious if residents could give feedback regarding loan repayment options and which ones are realistic during residency and into your career as an Ortho Attending or in private practice.

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[MedAppRx]

I attempted to make a graduated payment (10 year) plan, but ultimately life is more expensive than a resident's salary (even in the midwest, which is generally a cheaper lifestyle/reimbursement ratio).

I refinanced to a private holder with DRB. Not a bad setup, and a 5% interest rate. Ultimately you have a lot of tough choices to make about loans. With a wife and upcoming child in tow, I felt it smartest to hold off on loans, and attack them immediately once I make an attending's salary

 

[readdoc]

This loan repayment stuff is nuts. Forbearance. Deferment. It means you still have a ton of debt. Don't understand why we're not eligible for deferment as a resident. No one is really making money yet. How can anyone pay? I like the idea of refinancing to a lower interest rate. It's not something I'd thought about.

 

[massmocha]

This loan repayment stuff is nuts. Forbearance. Deferment. It means you still have a ton of debt. Don't understand why we're not eligible for deferment as a resident. No one is really making money yet. How can anyone pay? I like the idea of refinancing to a lower interest rate. It's not something I'd thought about.

You can defer your loans throughout all of residency and fellowship.

 

[readdoc]

I see where we can do forbearance -- which still lets interest pile up. But not deferment

 

[Handinhand]

While not a resident or attending yet, I am a 4th year medical student looking to go into orthopedics, and have spent time over the past 4 years learning about personal finance and investing, specifically geared towards physicians, to best prepare myself for the coming years.

I'm assuming you're a current medical student and taking out federal student loans. Depending on your year, with the restructuring of how interest has been calculated, your combined interest should be 6-7%, which is quite high. There are private companies which are as of 2015, starting to refinance federal student loans for residents down in the 4-6% interest range. This might not seem like a lot, but if you're sitting on 2-300,000$ of student loan debt, that refinance can ultimately save you 10's of thousands of dollars. If you go this route however, you are not eligible for IBR, PAYE, REPAYE, or any of the other graduated payment systems offered by the federal government, and you're also no longer eligible for loan forgiveness after 10 years (probably wouldn't qualify for this anyways, unless you go into peds ortho, and know you want to work at a larger children's hospital -- you need to be working for a non-profit hospital to qualify for loan forgiveness)

Whatever you choose, I would highly recommend making SOME payments on your loans during residency. First, because it will help knock down some of the interest you've been accruing during medical school, but more important than that is because it will help instill in you good budgeting/spending behavior, which will be important as an attending as well.

 

[blaqmamba]

If you go this route however, you are not eligible for IBR, PAYE, REPAYE, or any of the other graduated payment systems offered by the federal government, and you're also no longer eligible for loan forgiveness after 10 years (probably wouldn't qualify for this anyways, unless you go into peds ortho, and know you want to work at a larger children's hospital -- you need to be working for a non-profit hospital to qualify for loan forgiveness)

Why do you say only peds ortho? More places are considered 'non-profit' than you think. In fact, there are practice groups that set themselves up as non-profit.