Making sure I understand IBR and PSLF correctly...

[mmastell]

---

Members don't see this ad.

Hello,

I am currently starting MS4 and will be in about $215k of debt upon graduation from med school with a mix of subsidized, unsubsidized, and Grad PLUS loans. If I understand IBR and PSLF correctly, would there be any reason why I would not want to take out the maximum amount in student loans that I could this year? Assuming I am in residency for 5 years and then work at a non-profit hospital for another 5 years, all my loans would be forgiven regardless of the amount as long as I have been paying the minimum requirement, correct? I have the opportunity to take out an additional $6k in Grad PLUS loans that I don't "need," but it seems like free money. Should I? Is this line of thinking correct or feasible? Thank you very much for your responses.

 

[JacobMcCandles]

I think the main issue a lot of people have is if this program will actually come to fruition for 'high earner' such as physicians. Personally, I wouldn't take out any more than I need.

 

[dpmd]

The other issue being if you will actually work at a nonprofit after residency. Many specialties are employed by a for profit group even if they work at a hospital.

 

[dynx]

I'm just going to say again:
1. As mentioned this program may never pay out.

2. Even if it does pay out....there is no free lunch. Hospitals, healthcare systems and practices with accountants and MBAs much better at crunching numbers than you and me will find a way to cut into this money. Less pay for non-profits, contract negotiation leverage when they know you're desperate to get that last year or two of non-profit status in. I mean jesus, what would you do if you could get cheap labor? They know your schooling and work history...they can do the math. You need 5 more years at a non-profit? Here's a nice contract for 3 years. Now you want to renegotiate at a time when you should be able to demand more? I don't think so. They know you're counting on 200k (pluss interest) in loans to be forgiven. Guess where that money's going to come from? Thats right, your pay.

3. Its not legally clear if residents are students or employees. Sure the supreme court ruled that for payroll tax purposes we are classified as employees but for the purposes of this program how will we be counted? Are you sure that 5 year residency is going to count? I wouldn't make a 100k dollar bet on it.

 

[Svidrillion]

This is an issue I'm dealing with as well. My loans are about to go into repayment in a couple of months. I have the opportunity to pay my uncapitalized interest that has accrued on my unsubsidized loans before it capitalizes. However, part of me feels that this is just throwing away money if I have my loans eventually forgiven through PSLF.

Any thoughts or advice?

 

[Whiskeypunch]

The other issue being if you will actually work at a nonprofit after residency. Many specialties are employed by a for profit group even if they work at a hospital.

SO TIRED OF SEEING THIS. IT SAYS YOU ARE WRONG LIKE 50 TIMES IN TEH FAQ.

You don't have to work for a non-profit. You just have to work in a field involving "public health" aka any physician job.

 

[dpmd]

SO TIRED OF SEEING THIS. IT SAYS YOU ARE WRONG LIKE 50 TIMES IN TEH FAQ.

You don't have to work for a non-profit. You just have to work in a field involving "public health" aka any physician job.

Check your reading comprehension. It specifically states the employer needs to be government, tax exempt, nonprofit, or a NOT FOR PROFIT employer in certain areas (including medical jobs). Nowhere does it state that for profit medical groups would count.