student loans

[gasman2008]

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Now that the match is over and Ill be an intern in a few months, I have a couple of questions about student loans. Do most residents and interns defer their loans until after residency or do they pay them during residency? What are the options available?

Ill be going to U Kentucky, where the COL is really good so it would be nice to pay some of my loans back during residency.

 

[amyl]

someone else please correct me if i am wrong but i thought that laws were just passed that we couldn't defer our loans and would be committed to paying 15% of our salaries toward the loans...did anyone else hear that?

 

[Leverage]

Our Fin Aid Office said we could apply for deferment for one more year. As the law does not come into effect until next year.

Beyond that you can always get forbarence as a resident. I think it is called mandatory forbarence.

At least this is what the pros say at my school.

 

[DifficultAirway]

someone else please correct me if i am wrong but i thought that laws were just passed that we couldn't defer our loans and would be committed to paying 15% of our salaries toward the loans...did anyone else hear that?

IBR limits loan payments to 15 percent of the borrower's (and spouse's, if applicable) adjusted gross income that exceeds 150 percent of the poverty line applicable to the borrower's family size

Got that from this link. However i dont know what the poverty line is... if your income doesnt exceed the poverty line I guess you dont pay? Pls dont quote me on that im still trying to figure this all out myself.

http://www.nasfaa.org/Publications/2007/LNIBRProvisions102207.html

 

[scotchnwater]

The economic hardship deferment will remain in effect, which means we don't have to repay loans during residency. Even though the College Cost and Reduction Act of 2007 technically eliminated the deferment, the Dept. of Education allowed the deferment to remain. You can read the story here:

http://www.aamc.org/members/osr/communications/legislative_affairs/osrfocus_jan08.pdf

 

[Pilot Doc]

VERY important concept here

Deferment: make no payments, accrue no interest, eligibility depends on income, subject of recent changes in policy

Forbearance: make no payments, accrue interest, available to ANY resident, no recent changes in policy

You can still forbear ... and you should, every year, even if you want to make payments, because it prevents an oversight or cash crunch resulting in a missed payment which will raise your interest rates.

 

[nociceptor]

VERY important concept here

Deferment: make no payments, accrue no interest, eligibility depends on income, subject of recent changes in policy

Forbearance: make no payments, accrue interest, available to ANY resident, no recent changes in policy

You can still forbear ... and you should, every year, even if you want to make payments, because it prevents an oversight or cash crunch resulting in a missed payment which will raise your interest rates.

I am holding out for complete forgiveness during residency😀

 

[jonnyDRAMA]

great time to condolidate.. the interest rates are low now.. I consolidated at 7 percent. I was getting letters left and right so i said **** it ill consolidate. Now i caant reconsolidate... Im dealing with this high interest rate for the next 30 years im thinking about just defaulting.. The laws are made in favor of the banks. the government does not give a rats behind about students.

 

[FutureHuskerDoc]

great time to condolidate.. the interest rates are low now.. I consolidated at 7 percent. I was getting letters left and right so i said **** it ill consolidate. Now i caant reconsolidate... Im dealing with this high interest rate for the next 30 years im thinking about just defaulting.. The laws are made in favor of the banks. the government does not give a rats behind about students.

What's the rate at right now?

 

[seinfeld]

economic hardship deferment for 3 years then i started mandatory forbearance. I would have the paperwork ready but dont get the deferment until your 6 month grace period ends.

 

[swpm]

great time to condolidate.. the interest rates are low now.. I consolidated at 7 percent. I was getting letters left and right so i said **** it ill consolidate. Now i caant reconsolidate... Im dealing with this high interest rate for the next 30 years im thinking about just defaulting.. The laws are made in favor of the banks. the government does not give a rats behind about students.

We ought to bring back debtors' prison. You could run the clinic.

 

[supercut]

Hope you're not serious about defaulting. Because the laws that protect the banks also say they can come after you for the rest of your life...garnish wages, hold any tax refunds, liens on assets, etc. Student loans are one of the only debts that you can never get rid of..not even in bankruptcy.

You are right..the governement doesn't give a rats behind about students...especially after you get MD after your name, you are now part of the evil rich, exploiting everyone around you and deserving of nothing.

great time to condolidate.. the interest rates are low now.. I consolidated at 7 percent. I was getting letters left and right so i said **** it ill consolidate. Now i caant reconsolidate... Im dealing with this high interest rate for the next 30 years im thinking about just defaulting.. The laws are made in favor of the banks. the government does not give a rats behind about students.

 

[nociceptor]

Im dealing with this high interest rate for the next 30 years im thinking about just defaulting.. The laws are made in favor of the banks. the government does not give a rats behind about students.

Don't default. Apply and get as many credit cards as possible. When you have enough, take out cash advances for every single one of them and pay off your student loans. Next, file for bankruptcy. The worse thing that can happen is that your credit is ruined for a few years ( I think 11 or 7). I knew people who did this years ago. I knew a doctor who did it when he got sued, he filed for bankruptcy instead, lost all his debt, he used to brag about it all the time.

 

[medicinesux]

Don't default. Apply and get as many credit cards as possible. When you have enough, take out cash advances for every single one of them and pay off your student loans. Next, file for bankruptcy. The worse thing that can happen is that your credit is ruined for a few years ( I think 11 or 7). I knew people who did this years ago. I knew a doctor who did it when he got sued, he filed for bankruptcy instead, lost all his debt, he used to brag about it all the time.

The absolute brilliant plan you propose constitutes credit card fraud and would land you in much deeper troubles. You really think the credit card companies are that dumb? LOL

 

[titanjones]

I'm loving this thread!

 

[nociceptor]

The absolute brilliant plan you propose constitutes credit card fraud and would land you in much deeper troubles. You really think the credit card companies are that dumb? LOL

If you are asking me if the credit card companies are dumb. I say unequivocally yes! dumb and poorly managed.


That dumb? I don't know.


Maybe if you only use citibank and capital one credit cards.

 

[deleted77919]

Heck just move to a non-extradition country. Also helps if you can finagle citizenship there.

 

[FutureHuskerDoc]

If you are asking me if the credit card companies are dumb. I say unequivocally yes! dumb and poorly managed.


That dumb? I don't know.


Maybe if you only use citibank and capital one credit cards.

Don't try to pull that on Capital One!!!!

What's in your wallet?

 

[DrMunkey]

Like someone else said, consolidation at these rates would be a dumb idea to pass up!

In regards to forbearance, everyone should apply for forbearance because even while your loans are in forbearance, you're not obligated to pay. But there's the rub, if you want to keep the interest from accumulating, throw every red cent you can afford at the end of each month at them (or at least try to budget to pay SOMETHING to them at the beginning of the month). These are my $0.02.

 

[Pilot Doc]

if you want to keep the interest from accumulating, throw every red cent you can afford at the end of each month at them (or at least try to budget to pay SOMETHING to them at the beginning of the month). These are my $0.02.

I disagree.

Interest has value - it allows you to spend money today when it has higher marginal utility to you and pay it back later (as an attending) when the marginal utility of money is much lower. Put another way, the extra $100-$200/month as a resident will make a much bigger improvement to your quality of life than the extra money it will save you as an attending if you paid the debt off sooner.

 

[sallyjoe]

Don't default. Apply and get as many credit cards as possible. When you have enough, take out cash advances for every single one of them and pay off your student loans. Next, file for bankruptcy. The worse thing that can happen is that your credit is ruined for a few years ( I think 11 or 7). I knew people who did this years ago. I knew a doctor who did it when he got sued, he filed for bankruptcy instead, lost all his debt, he used to brag about it all the time.

Student loans are special dept since they can't be discharged in bankruptcy while unsecured dept like credit card dept can be discharged. Student loans dept can haunt you even in retirement where it is about the only dept that can be deducted from your social security benefits.

Unfortunately the law was changed in October 2005, so now you can‘t expect to have your debt discharged. It will be very difficult for a physician to be able to pass to pass the means test the new law requires, If you do not meet the means test you will be put under a court supervised dept repayment plan and have to pay off all of your dept.

Under the new bankruptcy law, as of October 17, 2005 bankruptcy applicants who wish to file under Chapter 7 must meet certain eligibility requirements under a "means test."

Under the "means test," if your current monthly income is less than the median income in your state, you can file for bankruptcy under Chapter 7. But if your current monthly income is above the median income in your state, and you can afford to pay $100 per month toward paying off your debt, you cannot file under Chapter 7 and must proceed under Chapter 13 (more on Chapter 13 in the next section). Whether you can afford to pay $100 per month (or $6,000 over a five-year period) is based on a formula that includes your monthly income, your expenses, and the total amount of your debt.

The change in the bankruptcy laws is very troubling since if you loose a big medical malpractice judgment you will not be able to hand over your non protected assets and then file bankruptcy and start over. Now your pain will be extended for at least five more years when your will be forced to pay off your creditors according to a court supervised budget. I.E you will be forced to live on the current state median income shown below and be forced to give any money earned above that to your creditors.
From;
http://www.usdoj.gov/ust/eo/bapcpa/20080201/bci_data/median_income_table.htm


. FAMILY SIZE
STATE 1 EARNER 2 PEOPLE 3 PEOPLE 4 PEOPLE *

ALABAMA $36,192 $44,918 $51,103 $62,015
ALASKA $45,012 $68,008 $72,382 $73,825
ARIZONA $40,945 $53,153 $59,782 $66,903
ARKANSAS $32,534 $41,760 $48,943 $53,671
CALIFORNIA $46,814 $61,742 $66,611 $76,931
COLORADO $44,203 $62,302 $66,731 $77,933
CONNECTICUT $55,410 $68,879 $78,973 $96,493
DELAWARE $44,378 $55,646 $66,687 $80,552
DISTRICT OF COLUMBIA $39,504 $67,790 $67,790 $73,609
FLORIDA $40,036 $50,636 $56,923 $66,876
GEORGIA $39,171 $51,425 $58,885 $68,611
HAWAII $47,256 $60,223 $71,553 $86,878
IDAHO $37,347 $48,211 $54,709 $59,720
ILLINOIS $44,673 $56,545 $66,607 $77,634
INDIANA $39,384 $51,056 $57,510 $69,718
IOWA $37,759 $50,581 $59,331 $69,723
KANSAS $38,594 $52,989 $58,075 $69,831
KENTUCKY $37,097 $43,482 $52,106 $61,917
LOUISIANA $34,342 $42,682 $52,231 $61,874
MAINE $38,090 $47,699 $59,883 $65,310
MARYLAND $52,597 $68,075 $80,344 $96,695
MASSACHUSETTS $52,633 $63,039 $77,960 $91,892
MICHIGAN $43,123 $51,878 $61,796 $74,658
MINNESOTA $45,217 $60,377 $70,695 $83,797
MISSISSIPPI $30,424 $38,919 $43,587 $54,501
MISSOURI $37,747 $48,944 $56,478 $65,076
MONTANA $38,968 $48,079 $53,595 $62,301
NEBRASKA $37,209 $52,690 $59,708 $70,880
NEVADA $45,642 $57,860 $65,032 $67,977
NEW HAMPSHIRE $51,512 $63,505 $72,736 $89,885
NEW JERSEY $56,151 $64,821 $83,306 $97,131
NEW MEXICO $35,691 $48,870 $48,870 $53,516
NEW YORK $44,587 $54,397 $64,673 $77,664
NORTH CAROLINA $36,271 $49,259 $55,498 $63,169
NORTH DAKOTA $36,735 $49,893 $61,305 $69,484
OHIO $40,168 $49,708 $59,786 $70,532
OKLAHOMA $34,554 $46,222 $48,730 $56,598
OREGON $42,460 $53,236 $59,686 $66,678
PENNSYLVANIA $43,166 $50,628 $63,491 $76,182
RHODE ISLAND $47,080 $59,763 $64,933 $80,416
SOUTH CAROLINA $35,185 $46,521 $52,992 $61,362
SOUTH DAKOTA $32,854 $49,419 $61,884 $65,317
TENNESSEE $36,380 $46,039 $53,337 $61,856
TEXAS $36,285 $51,355 $53,803 $61,511
UTAH $45,724 $51,583 $58,285 $65,397
VERMONT $42,344 $53,622 $61,825 $69,817
VIRGINIA $46,055 $61,115 $69,719 $80,646
WASHINGTON $48,030 $60,252 $68,139 $77,280
WEST VIRGINIA $37,164 $39,602 $50,440 $57,513
WISCONSIN $41,528 $54,297 $65,440 $74,560
WYOMING $35,941 $53,330 $60,289 $73,597

* Add $6,900 for each individual in excess of 4.

 

[nociceptor]

Student loans are special dept since they can’t be discharged in bankruptcy while unsecured dept like credit card dept can be discharged. Student loans dept can haunt you even in retirement where it is about the only dept that can be deducted from your social security benefits.

Unfortunately the law was changed in October 2005, so now you can‘t expect to have your debt discharged. It will be very difficult for a physician to be able to pass to pass the means test the new law requires, If you do not meet the means test you will be put under a court supervised dept repayment plan and have to pay off all of your dept.

Under the new bankruptcy law, as of October 17, 2005 bankruptcy applicants who wish to file under Chapter 7 must meet certain eligibility requirements under a "means test."

Under the "means test," if your current monthly income is less than the median income in your state, you can file for bankruptcy under Chapter 7. But if your current monthly income is above the median income in your state, and you can afford to pay $100 per month toward paying off your debt, you cannot file under Chapter 7 and must proceed under Chapter 13 (more on Chapter 13 in the next section). Whether you can afford to pay $100 per month (or $6,000 over a five-year period) is based on a formula that includes your monthly income, your expenses, and the total amount of your debt.

The change in the bankruptcy laws is very troubling since if you loose a big medical malpractice judgment you will not be able to hand over your non protected assets and then file bankruptcy and start over. Now your pain will be extended for at least five more years when your will be forced to pay off your creditors according to a court supervised budget. I.E you will be forced to live on the current state median income shown below and be forced to give any money earned above that to your creditors.
From;
http://www.usdoj.gov/ust/eo/bapcpa/20080201/bci_data/median_income_table.htm


. FAMILY SIZE
STATE 1 EARNER 2 PEOPLE 3 PEOPLE 4 PEOPLE *

ALABAMA $36,192 $44,918 $51,103 $62,015
ALASKA $45,012 $68,008 $72,382 $73,825
ARIZONA $40,945 $53,153 $59,782 $66,903
ARKANSAS $32,534 $41,760 $48,943 $53,671
CALIFORNIA $46,814 $61,742 $66,611 $76,931
COLORADO $44,203 $62,302 $66,731 $77,933
CONNECTICUT $55,410 $68,879 $78,973 $96,493
DELAWARE $44,378 $55,646 $66,687 $80,552
DISTRICT OF COLUMBIA $39,504 $67,790 $67,790 $73,609
FLORIDA $40,036 $50,636 $56,923 $66,876
GEORGIA $39,171 $51,425 $58,885 $68,611
HAWAII $47,256 $60,223 $71,553 $86,878
IDAHO $37,347 $48,211 $54,709 $59,720
ILLINOIS $44,673 $56,545 $66,607 $77,634
INDIANA $39,384 $51,056 $57,510 $69,718
IOWA $37,759 $50,581 $59,331 $69,723
KANSAS $38,594 $52,989 $58,075 $69,831
KENTUCKY $37,097 $43,482 $52,106 $61,917
LOUISIANA $34,342 $42,682 $52,231 $61,874
MAINE $38,090 $47,699 $59,883 $65,310
MARYLAND $52,597 $68,075 $80,344 $96,695
MASSACHUSETTS $52,633 $63,039 $77,960 $91,892
MICHIGAN $43,123 $51,878 $61,796 $74,658
MINNESOTA $45,217 $60,377 $70,695 $83,797
MISSISSIPPI $30,424 $38,919 $43,587 $54,501
MISSOURI $37,747 $48,944 $56,478 $65,076
MONTANA $38,968 $48,079 $53,595 $62,301
NEBRASKA $37,209 $52,690 $59,708 $70,880
NEVADA $45,642 $57,860 $65,032 $67,977
NEW HAMPSHIRE $51,512 $63,505 $72,736 $89,885
NEW JERSEY $56,151 $64,821 $83,306 $97,131
NEW MEXICO $35,691 $48,870 $48,870 $53,516
NEW YORK $44,587 $54,397 $64,673 $77,664
NORTH CAROLINA $36,271 $49,259 $55,498 $63,169
NORTH DAKOTA $36,735 $49,893 $61,305 $69,484
OHIO $40,168 $49,708 $59,786 $70,532
OKLAHOMA $34,554 $46,222 $48,730 $56,598
OREGON $42,460 $53,236 $59,686 $66,678
PENNSYLVANIA $43,166 $50,628 $63,491 $76,182
RHODE ISLAND $47,080 $59,763 $64,933 $80,416
SOUTH CAROLINA $35,185 $46,521 $52,992 $61,362
SOUTH DAKOTA $32,854 $49,419 $61,884 $65,317
TENNESSEE $36,380 $46,039 $53,337 $61,856
TEXAS $36,285 $51,355 $53,803 $61,511
UTAH $45,724 $51,583 $58,285 $65,397
VERMONT $42,344 $53,622 $61,825 $69,817
VIRGINIA $46,055 $61,115 $69,719 $80,646
WASHINGTON $48,030 $60,252 $68,139 $77,280
WEST VIRGINIA $37,164 $39,602 $50,440 $57,513
WISCONSIN $41,528 $54,297 $65,440 $74,560
WYOMING $35,941 $53,330 $60,289 $73,597

* Add $6,900 for each individual in excess of 4.

This doesn't make me happy🙁🙁🙁🙁

The little guy can't win. Is there any exceptions?

 

[sallyjoe]

This doesn't make me happy🙁🙁🙁🙁

The little guy can't win. Is there any exceptions?

If you make more money that the median income in your state you many be able to get out of non secured credit card, non student loan dept. By barrowing to little to make suing you worthwhile, and just igone the repeated threat letters and phone calls of the lenders until after a number of years (5 to 7 deprending on your state) if you have made no payment you are no longer legally responsible for the debt. If the dept is small enough that it is not worthwhile to sue over so all your creditor can do is threaten you with letters and phone calls. Thus you can still pay off your student loans with credit card dept but you will probable need to used dozens of credit cards instead of just a few. When your creditors give up all hope of collecting the dept they will report the dept to the IRS as income so you may wind up paying taxes on the debt.

With late fees and penalties even the smallest of credit card balances could balloon it some thing worth while for a lawsuit. It would take a very determined individual to resist the constant calls and other games, the several dozen creditors will try to get you to pay. They will find out where you live and work and call repeatedly.

 

[amyl]

look what happened to that famous boxer...Joe Lewis, i think? He owed a little bit to the IRS and it turned into millions...he couldn't keep up with the penalties and fees...

 

[amyl]

look what happened to that famous boxer...Joe Lewis, i think? He owed a little bit to the IRS and it turned into millions...he couldn't keep up with the penalties and fees...

 

[gymone1]

Hi. I was wondering if anyone else was having trouble filing for economic hardship deferment? I just went online at Sallie Mae and entered all my numbers (normal 42k intern salary, 1 person household, slightly over 100k in debt) and it keeps saying I am not eligible? That cannot possibly be right, can it? Anyways, I am freaking out as I just bought a townhouse last week and have a larger morgage that if I was renting for the next four years. I just assumed I would qualify because last time I checked 42k isnt a ton to live on and 100k in loans isnt chump change.

 

[mmag]

Looking over the paper work to file for deferment from federal loans, I see two options for determining your income eligibility. 1 is by monthly income; 2 is by gross income as reported on your tax return for the previous year divided by 12.

I'm in the same situation as you as far as the numbers go (my school's info said that I couldn't qualify either) but I plan to file using criteria 2.
My grace period ends in November 2008 (remember to file no more than 30 days before). I will use my 2007 tax return which since I was in med school full time the entire year will show basically no income. That should get me a year, until Nov 2009. I will apply again but this time using my 2008 tax returns which shows income as 21 k (from the first 6 months of internship) which should put me in the range for deferring another year.

If anyone is more knowledgeable about deferment please share your thoughts as to the viability of my plan.

Hi. I was wondering if anyone else was having trouble filing for economic hardship deferment? I just went online at Sallie Mae and entered all my numbers (normal 42k intern salary, 1 person household, slightly over 100k in debt) and it keeps saying I am not eligible? That cannot possibly be right, can it? Anyways, I am freaking out as I just bought a townhouse last week and have a larger morgage that if I was renting for the next four years. I just assumed I would qualify because last time I checked 42k isnt a ton to live on and 100k in loans isnt chump change.

 

[jetproppilot]

Now that the match is over and Ill be an intern in a few months, I have a couple of questions about student loans. Do most residents and interns defer their loans until after residency or do they pay them during residency? What are the options available?

Ill be going to U Kentucky, where the COL is really good so it would be nice to pay some of my loans back during residency.

Whats really scary about this thread is that its posted in the anesthesia forum, where clinicians will emerge from residency with great salaries....

....and yet, its still anxiety provoking.

Imagine emerging from your residency making less than half of what you're gonna make....and having to deal with the same monetary issues you are gonna deal with, i.e. primary care docs.

I raised this issue in their forum and was met with AK-47s.

Call it inflammatory or whatever....but student loan debt is a real issue that meets you head on July 1st after your residency completion, regardless of your specialty selection; regardless of your debt load.

Posters in the family medicine forum chose to flame this issue rather than speak pragmatically about it.

Interesting to see anesthesia colleagues sweating out the student loan issue.

I feel ya'lls pain....I was there too, with near 200K after residency.

keep in mind though that your salary after residency will ease your anxiety.

Keep your lifestyle in check and you'll be able to live a monetary life above and beyond what you've been doing as a resident, AND pay off your student loan debt.

Don't default.

Thats the stupidest thing I've heard yet.

Your credit rating affects more than you think.

 

[nociceptor]

Interesting to see anesthesia colleagues sweating out the student loan issue.

I feel ya'lls pain....I was there too, with near 200K after residency.

keep in mind though that your salary after residency will ease your anxiety.

Keep your lifestyle in check and you'll be able to live a monetary life above and beyond what you've been doing as a resident, AND pay off your student loan debt.

Don't default.
.

hey working in NOLA do you get a loan forgiveness or anything like that. I heard a rumor that to attract physicians they were doing that?


http://www.ama-assn.org/amednews/site/free/prsb0806.htm

 

[jetproppilot]

hey working in NOLA do you get a loan forgiveness or anything like that. I heard a rumor that to attract physicians they were doing that?


http://www.ama-assn.org/amednews/site/free/prsb0806.htm

Not in anesthesia land.

 

[Indie4]

Our Fin Aid Office said we could apply for deferment for one more year. As the law does not come into effect until next year.

What does this mean for the class of 2009? I cant believe how jacked up that is for those of us to come. I hate how our government continues to find ways to punish those who work hard while rewarding laziness.