Making monthly loan payments during residency

[goldenbears18]

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As someone who plans to borrow the entire cost of my medical school education (I don't qualify for need-based grants/scholarships), I am really worried that it won't be financially possible to start loan repayment during residency. Some private schools' financial aid brochures predict monthly payments of over $2400 on a $200,000 loan, which is 3/4 of the average resident's salary! My question is: is it actually possible for residents to pay their rent, pay taxes, eat, get clothed, and pay back their private school loans without requesting a deferrment or getting help from family members?

 

[Allygator89]

Yes. You have to live like you are still in Med School, and possibly pick up another job moonlighting. Also, if you are married, use only one salary. If you don't live it up like you did in college, and only take what you ABSOLUTELY need, it is very possible. I have seen many people do it. The ones that make it possible are the ones that live the cheapest.

 

[Brewster]

There are also deferments available so that you don't have to make payments for a few years after med school.

 

[jon_jon]

Only a very small percentage of people pay back their student loans during residency. Most people defer the loans during residency and start paying after residency/fellowship. Having said that, many attendings pay $3000-4000 a month for loans over $200,000.

I have seen some residents with a smaller amount of loan starting to pay off their loans during residency, but their repayment terms are 30 years and with the low interests, I think they only pay a few hundred a month.

As a med student, you should be able to take out Stafford Loans upto a max of $38,500 each year. These are definitely better than private loans.

 

[carrigallen]

Originally posted by jon_jon
Only a very small percentage of people pay back their student loans during residency. Most people defer the loans during residency and start paying after residency/fellowship. Having said that, many attendings pay $3000-4000 a month for loans over $200,000.

I have seen some residents with a smaller amount of loan starting to pay off their loans during residency, but their repayment terms are 30 years and with the low interests, I think they only pay a few hundred a month.

As a med student, you should be able to take out Stafford Loans upto a max of $38,500 each year. These are definitely better than private loans.

Although for your first year, Subsized Staffords are only available for a maximium $8,500.

 

[Brewster]

Subsidized Stafford loans are capped at $8500/year every year. You can take out the rest as an Unsubsidized Stafford. The only difference is that the Unsubsidized portion will acrue interest during med school (albeit at a relatively low rate).

 

[peace_puff]

During my financial aid exit interview at my University, I talked with the financial aid counselor a little bit about how I should handle financing my future medical education.

Basically, she told me to borrow as much as I needed to, to not skimp on the aid, thinking that I just won't have to pay as much back and that's all that matters. She said that I can halt repayment of my med school loans for up to 7 years using a couple different things--by filing for financial hardship (when loan payments are too much compared to income) and getting forbearance and deferrment. She also did exit interviews with graduating med students, and some of them did skimp on the borrowing--now they have to start repayment during residency because they can't qualify for financial hardship due to the relatively low amount they borrowed.

I, too, will be borrowing the entire amount for med school. Of course I will live frugally in order to get by, but I will not hesitate to borrow what I need.