Does anyone know if we are still designated as "students" during residency? Would debt incurred up until that time still be deferred until residency is completed, or does debt repayment begin as soon as the 4 years of med school are over?
Repayment during Residency?
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Fin-Nor said:
Yes, I understand the concept and possibility of deferments...my question was more asking whether enrollment in a residency program still qualifies you for "student" status as during med school (and thus debt does not yet enter repayment) or is it considered "full time employment" (and thus debt enters repayment, but with deferment possible). Technically, residents earn $ so i would think it would disqualify "student" status, but be considered "employment" instead.
Can anyone verify or clarify this?
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I am not sure about your status but I do know that once you graduate medical school, you have 6 months of grace period. After those 6 months, you will have to start paying back, even though you are in residency.Xmulder said:
It is here that most residents do economic deferment for 3 years, renewing it every year. Most doctors don't repay their loans during residency because you're making $40K a year, which comes out to about $26K net after federal and state taxes.
This leaves you with about $2K a month to survive on, raising your family and so forth. The standard repayment plan per month calls for paying back $2K a month so obviously you won't have money to repay your loans yet.
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Most residents get the deferment which is why they end up not having to pay during residency. If they don't get a deferment, they have to start repayment. However, almost always, residents qualify for it which is the reason why you see basically no residents paying back their loans during residency. Of course, this applies only for federal loans.OSUdoc08 said:
I believe private loans also have deferment options but the time length and the rules vary among private loans.
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OSUdoc08 said:
Not true...you are only 'guaranteed' 3 years of deferment during residency. Any person who enters a program that takes longer than that is subject to repayment, making future arrangements a case-specific matter.
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Qualifying for deferment on Stafford loans depends on the amount of your monthly loan payment, your household's monthly income, and the poverty level in your state. If your loan payment is too low you will be required to make payments during residency. For a typical resident salary (i.e., no spousal income) with a typical interest rate (about 5%) you will only qualify for deferment if you have more than about $85,000 in loans to repay. Less than that and you will be required to repay. And it is true that if you qualify it only lasts 3 years maximum.
There once was an automatic residency deferment (on top of the hardship deferment and forebearance) but the residency deferment is no longer available.
There once was an automatic residency deferment (on top of the hardship deferment and forebearance) but the residency deferment is no longer available.
mpp said:
Hi, thanks for your post, but I am a bit confused on the details. Do you mean that anyone (assuming single) with <$85K in debt needs to begin repayment during residency? Or do you mean just in Stafford loans?
Is it total indebtedness (i.e. Stafford plus Perkins, private loans, etc) or just Stafford?
I am also not sure what you mean when you say the 'automatic residency deferment' is no more. Isn't this what we have been talking about?
confused.
Anyone have general stats on residents? What is the avg debt level that a student holds upon entering a typical residency? What fraction or % of ppl have little to no debt (i.e. have rich parents)?
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The 85k figure is an estimate for all Federal loans (including Perkins, HEAL, GSL, federal consolidation loans, etc.). Private loans would not be included in this figure as deferment eligibility would depend on the lender's agreement with you.
There once was an automatic deferment of federal loans for people in graduate medical education (i.e., residents) regardless of their income or monthly loan payment. This automatic deferment is no longer available and all people with federal student loans (regardless of whether they are from undergrad, graduate school, medical school, etc.) are eligible for a maximum of 3 years of hardship deferment if they qualify.
The average debt for all medical students graduating in 2002 was about $104,000 ($91,389 for public schools and $123,780 for private schools). About 19% of 2002 graduates had no debt. About 24% had over $150,000 in loans.
There once was an automatic deferment of federal loans for people in graduate medical education (i.e., residents) regardless of their income or monthly loan payment. This automatic deferment is no longer available and all people with federal student loans (regardless of whether they are from undergrad, graduate school, medical school, etc.) are eligible for a maximum of 3 years of hardship deferment if they qualify.
The average debt for all medical students graduating in 2002 was about $104,000 ($91,389 for public schools and $123,780 for private schools). About 19% of 2002 graduates had no debt. About 24% had over $150,000 in loans.
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This is what ticks me off about the residency compensation system. We're considered "students in training" when its convenient to the university/hospital. Then we're employees when it is in their favor.
We should be employees. Period. This way we can justify higher salaries and can demand equal benefits (health,disability, retirement, 401k) as other employees of the system.
We should be employees. Period. This way we can justify higher salaries and can demand equal benefits (health,disability, retirement, 401k) as other employees of the system.
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At my program, residents do quaify for insurance and retirement plans. Actually, the benefit package is pretty good.
You can apply for residency deferrment for up to 3 years. ONe of my lenders is making my life miserable refusing to grant it with no valid explanation. Realize it's not a guarentee. You can get other deferements (like economic hardship) so you can avoid paying all duirng residency. But you still accumulate interest.
And yes, MOST residencies are more that 3 years. ALL the surgical fields are greater than 3 years. As is radiology, pathology, anesthesia, med-peds, OB and some EM programs. I've probably left some out. I'd be willing to bet that 3 year programs are acutally the minority. (IM, peds, FP and many EM programs)
You can apply for residency deferrment for up to 3 years. ONe of my lenders is making my life miserable refusing to grant it with no valid explanation. Realize it's not a guarentee. You can get other deferements (like economic hardship) so you can avoid paying all duirng residency. But you still accumulate interest.
And yes, MOST residencies are more that 3 years. ALL the surgical fields are greater than 3 years. As is radiology, pathology, anesthesia, med-peds, OB and some EM programs. I've probably left some out. I'd be willing to bet that 3 year programs are acutally the minority. (IM, peds, FP and many EM programs)
