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Super Primary Care Loan

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Cornell08

PhillyGuy08
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I tried searching back to find any semi-recent threads on the topic so I wanted to chime in and see if anyone else has had experience with the Primary Care/Super Primary Care Loan. I wanted to hear other people's opinions on the program. I consider myself very money aware and take pride in being aware of my finances. I feel like a lot of my med school peers try to pretend that they don't have any debt. Some have dumb parents who give bad advice-- one told my friend that she should pay the minimums on her loan as long as possible because she could invest her money and get a higher return. I told her you're paying close to 7% on your student loans, you'd have to make about 9-10% before taxes on your investments to make that happen and this isn't 1981 anymore or even 2005. Rate of inflation/rate of return are lower. But that's an aside.

From what I could see the program is only applicable to schools that produce at least 50% primary care doctors. I didn't even know the Super Primary Care Loan existed until I applied for the Primary Care Loan a month ago and was told about it. Before this I was considering getting my loans purchased/refinanced by DRB or SoFi.

I go to an osteopathic medical school and will be starting my ACGME Pediatrics residency in July 2016. I have around 250k in loans ($217k in principal). The super primary care loan will buyout all of the principal. My goal is to pay off the roughly $30k in interest I have accrued during medical school during residency. I am married and my wife works and I'm aiming to pay off that $30k in interest plus socking away another $40k to be applied to my loan after finishing residency when the loan starts accruing interest. Assuming I do primary care, after my 3 years of residency I aim to pay off about $5k/month until the debt is gone, so a little over 3 years considering that money will begin accruing interest.

I did consider avoiding the PCL because it removes the Income based repayment and public service loan forgiveness. IBR I was less concerned about because the PCL does not accrue interest during residency which is a huge savings when my consolidated interest rate wold have been close to 7% between unsubsidized Stafford loans and Grad Plus Loans. PSLF requires 1) Congress to not balk at the program and making it difficult once doctors are getting huge debts waived 2) requires me to work in a 501(c)3 for 7 years after residency which I'm not sure if I want to do and I'm not sure if a possibly lower salary will be offset by the loan forgiveness 3) requires the forgiven amount to be considered as income.

The big advantages I see to the program are:
1) No interest is accrued during residency so I can begin making a dent into my debt. Also this saves about $15k a year on $217k at nearly 7%.
2) 5% interest rate after residency which is more reasonable although an ARM through SoFi or DRB might be better.

Big Disadvantage is if I do find my way into a good job at a non-profit then I would not be able to do PSLF.

White Coat Investor, I love your website, any thoughts on this loan program?
 
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