Student Loan Repayment ??

[JaneDoe]

For those of you who are in repayment on your student loans, how fast are you paying them off? When my loans went into repayment, I was paying them off at the 10 year rate. But, once my Dh's loans went into repayment, I had to cut back and pay them off at the 25 year rate. I was able to cut my debt by about a third by the time I had to lower my payments. Now, it feels like it is taking forever for the principal to go down.

Dh is paying his off at the 25 year rate too. I hope to in the next year or so to begin to repay ours off quicker. The interest rates are so low that perhaps we should pay our our mortgage faster, but I just want these loans gone so I have more discretionary money!!!

[Stella]

I'm on a graduated 15 year plan. SO has no loans thanks to mom and dad. (Lucky bastard, I know.)

[reciprocity]

My law school debt is pushed out to 30 years, and even still is more than my rent every month.

[houseelf]

My debt is over 25 years and costs just under our mortgage payment. Won't it be fun when BOTH of our debt comes due.

Kelly

[Sheherezade]

We're paying 30 year consolidated. It is also similar to our mortgage payment. I've been thinking we should pay them down as well, but I wonder if the money isn't better spent on the mortgage. The interest rate for the mortgage is much higher, but that debt offers the tax advantage. It's a quandry. I don't even know if there is a penalty for prepayment on the consolidated loan. I should find that out, shouldn't I? I'd hope not. Our consolidation was done in great panic with little time to think things through (fellowship/babies), so it's possible.

What's your situation?

[JaneDoe]

Dh and I have about $135,000 in student loan debt combined. Our mortgage payments are much higher than our student loan payments. We don't have any credit card debt or auto loan debt (though our cars each have over 110,000 miles - and I see major repairs/need new cars in the very near future).

I'm selfishly just getting to the point in my life where I want fun stuff - like nice furniture. So, I'm trying to find a way to make our student loans disappear, but it's not happening anytime soon. I guess we would probably be wiser focusing on the mortgage because it has a higher interest rate. I don't know. I guess I need to continue to delay gratification.

[Sheherezade]

Did you pay down a lot of principal when you were on the 10 year plan? I'd like to start doing that for DH's med school loans. (Applying a separate payment each month to principal.)

I hear ya about the nice stuff. I can't bring myself to get plumbers, electricians and the like out to the house because I'm scared to hear estimates. I'm still stuck in the poverty mindset. That's probably a good thing. My answer to everything is "We can't afford it. We're broke." DH is always surprised when he finds money in our account. I hope to keep it that way.

This is in theory....DH consolidated his loans a few years ago and has a very low rate. The 30 year payment isn't too bad. I figure that we will never have a rate that low on any other sort of loan and any spare money would best be directed towards retirement, college, etc. Along those lines, if you have less of a car loan or payments for other things, spend it there.

On the other hand, the thought of paying off those loans for 30 years makes me a little queasy. I'd love to be rid of them before then. I like Angie's idea of making payments to the principal.

[JaneDoe]

Yes. I was in repayment for four years before Dh's loans went into repayment. I was paying at the 10 year rate for those four years and I cut my student loan by more than a third. It felt really good to see that principal go down each month. I'd like to do that again in about a year. My goal is still to have my loans paid off in 10 years, which means by the end of 2010. I have the same goal for Dh, which means by the end of 2014 for him.

[MissCrabette]

I'm on a graduated 15 year plan. SO has no loans thanks to mom and dad. (Lucky bastard, I know.)

That is exactly my situation. I doubt my fiance will have ANY loans by the time he finishes med school because mommy and daddy take care of everything. Can you believe he still gets an allowance? Must be nice.

[Stella]

I'm on a graduated 15 year plan. SO has no loans thanks to mom and dad. (Lucky bastard, I know.)

That is exactly my situation. I doubt my fiance will have ANY loans by the time he finishes med school because mommy and daddy take care of everything. Can you believe he still gets an allowance? Must be nice.

MINE TOO! I keep reminding myself to be grateful and not resent that I wasn't blessed with the same generosity from my own parents. Besides, SO has already told me he's paying off my loans as soon as we're married and he's earning a salary. I guess I will just be grateful for that!!

[MissCrabette]

Stella, I'd personally hold off on paying off the student loan. I got an amazing interest rate when I consolidated last year and it wouldn't make much financial sense to pay it off when that money would generate a lot more interest in a simple savings account.

[Stella]

I'm paying it off right now on a graduated rate (of course principal hasn't moved at all...) so that when he's really making money we can wipe it all out at once. That's our only real debt so he wants to get rid of it as soon as possible.

We are on the 30 year repayment plan. We had initally planned on paying off DH's loans within the first two years out of training, but it just didn't make sense with the low interest rate. The interest rate on his school loans is around 3% so instead of putting extra money towards paying down those loans, it makes more sense to put it towards the house or invest it and make 10% or more on it.

I hate the thought of making student loan payments for the next 28 years , but we have the payments automatically deducted each month so we don't notice the money going out.

[PrincessFiona]

We're on the 30 year plan, but we pay extra each month (that all goes towards the principal) to pay it off faster.

kris