My husband and both started out medical school but I became ill and had to end my schooling. We each have school loans. He is currently a second year resident on forbearance because we didn't think we could have afford to make any minimal payments through IBR. I am unemployed and making interest only payments on my loan. I am currently looking for work with the hope of earning extra income to apply for IBR while he is a resident. My question is how would we go about applying for IBR. Do we each apply separately to IBR? Would my payments be based only on my AGI? or does it have to be combined income? Which is the smarter thing to do? Sorry if I sound clueless, I am. Btw, last question is any residents can qualify for IBR but not PSLF right? If so, how long would IBR last without being on PSLF? Thanks for any insight.
Lost and confused
- Thread starter harmnot
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First off, congrats for trying to find a solution to your troubles instead of just complaining about things being unfair.
As far as IBR goes, you both apply for it with your lender(s) and it is based on your AGI typically. If you and your husband file together then it would be based on both your incomes, but you would also give them info on both of your loans. It would probably result in payments of 0 for both of you since you have no income and his is presumably low. This would increase as his income increases (and hopefully as you obtain an income
), but as long as the payments are less than the standard repayment you would stay on it up until 25 yrs of repayment at which time anything remaining would be forgiven (regardless of who you worked for). If your incomes rise to the point the calculated amount would be more than the standard repayment it just kicks you back to the standard payment (which means you likely wouldn't make it to 25 yrs of repayment so nothing is forgiven).
I think IBR with you two filing jointly would be the best thing since filing jointly allows you to take things like the deduction for student loan interest paid (and it wouldn't hurt you since you both have loans and your combined income isn't a lot). Unless your loans have some terms that are different from each other there isn't a reason to favor paying one over another.
As far as IBR goes, you both apply for it with your lender(s) and it is based on your AGI typically. If you and your husband file together then it would be based on both your incomes, but you would also give them info on both of your loans. It would probably result in payments of 0 for both of you since you have no income and his is presumably low. This would increase as his income increases (and hopefully as you obtain an income
), but as long as the payments are less than the standard repayment you would stay on it up until 25 yrs of repayment at which time anything remaining would be forgiven (regardless of who you worked for). If your incomes rise to the point the calculated amount would be more than the standard repayment it just kicks you back to the standard payment (which means you likely wouldn't make it to 25 yrs of repayment so nothing is forgiven). I think IBR with you two filing jointly would be the best thing since filing jointly allows you to take things like the deduction for student loan interest paid (and it wouldn't hurt you since you both have loans and your combined income isn't a lot). Unless your loans have some terms that are different from each other there isn't a reason to favor paying one over another.
If you and your husband file together then it would be based on both your incomes, but you would also give them info on both of your loans. It would probably result in payments of 0 for both of you since you have no income and his is presumably low.
Sorry if I sound clueless, but how would our monthly payments be 0? Yes, his salary is low and I am currently unemployed. I assumed that our payments would be 15% of our adjusted gross income right? Thx
Sorry if I sound clueless, but how would our monthly payments be 0? Yes, his salary is low and I am currently unemployed. I assumed that our payments would be 15% of our adjusted gross income right? Thx
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No, your payments would be 15% of the amount of money you make over the poverty line for your family size (actually it is your AGI minus 150% of the poverty line. I would guess two people on a residents salary wouldn't be much above the poverty line (then again I don't know how much he gets where he is-maybe your payments would be 100 or 200).
Thanks for taking the time to share what you know for those of us who are just "lost and confused" like myself. Btw, do you know if I have to be working at a non-profit institution ( assuming that my husband would be) in order for us to qualify for PSLF? Secondly, if we do begin IBR, would we qualify for forbearance should we experience financial hardship? Again, thank you so much...and thank goodness for sites like this and people like you🙂
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Interesting question that I don't know the answer to, but I will take a guess at-if you are working at a regular place and he is working at a nonprofit both of your incomes would still be looked at for the payments, but only his loans would qualify for the PSLF
If you are in IBR and have a temporary hardship not reflected in your AGI (so your payment doesn't drop) then you can do forbearance but it pauses the repayment clock for the PSLF
If you are in IBR and have a temporary hardship not reflected in your AGI (so your payment doesn't drop) then you can do forbearance but it pauses the repayment clock for the PSLF
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