The Payback?

[gottamakeit]

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O.K. I have a question? How much money do they take out of your residency paycheck to pay back student loans? Say that you are $100,000 in student loan debt....?How much do they take each paycheck to pay the loans back?

 

[ShyRem]

I believe most loans are deferred through residency. And they don't take money from your paycheck - you have to make the payment yourself either through auto payment from your bank account each month or write a check.

As for how much it'll cost you, there are several calculators on the web to assist you with this calculation. It will depend on the interest rate of the loan and the amortization term (how long the repayment term is, whether 5, 10, 15, or even 20 years to pay the loan back).

 

[OSUdoc08]

O.K. I have a question? How much money do they take out of your residency paycheck to pay back student loans? Say that you are $100,000 in student loan debt....?How much do they take each paycheck to pay the loans back?

ZERO. You defer or forbear your loans until you complete residency.

 

[Blade28]

Every year you can apply for deferment or forbearance. Deferring your loans means you can delay payment AND the interest from accumulating. Forbearance means you don't have to pay, but the interest will start accumulating (for subsidized loans) or continue to accumulate (for unsubsidized loans). I think you can only apply for deferment for a total of 3 years (sucks for those in longer residency programs).

 

[UserNameNeeded]

Is there a way to know exactly what'll qualify you for a deferrment? How much in Stafford loans should I have at graduation to qualify for deferrment during a residency (assuming the 10 years to pay it back)? Does it depend on my salary as a resident?

 

[OSUdoc08]

Is there a way to know exactly what'll qualify you for a deferrment? How much in Stafford loans should I have at graduation to qualify for deferrment during a residency (assuming the 10 years to pay it back)? Does it depend on my salary as a resident?

The monthly payment has to exceed a percentage of your salary. I don't know what that percentage is, however.

Obviously if you get a high paying residency and have few loans, you will not qualify.

 

[UserNameNeeded]

Yeah, that's why I want to calculate the "right" amount of loans I should be taking out for the next four years. I remember one of the financial aid staff saying she's seen many students who were being thrifty and borrowing the bare minimum of what they needed (which would normally be good), but ended up not having borrowed enough to qualify for deferment.

 

[UserNameNeeded]

So then they pay back their loans sooner. Borrowing less money is still the better plan.

But there is such a thing as too soon. You're not on sound financial ground until after residency. Going into repayment even with, say, 80K in loans right after graduation is far more painful than having the luxury of deferring on slightly more loans of, say, 100K.

You'd have, at most, 3 years post-graduation to be saving some money while still being able to begin repayment on the unsubsidized loans. Since deferrment's best benefit is that Uncle Sam's paying the interest on the subsidized loans, it gives you the breathing room to start paying back the unsubsidized portion of your loan, instead of starting repayment on ALL of the outstanding loans.

 

[rgerwin]

I'm going to defer, and at least try and pay the interest, or save the interest for later.