Loan Forbearance/Deferment

[MarissaNicole]

I'm the wife of an MS3 and from what I understand you can defer your loans for three years during residency - but no longer than that regardless of the length of residency. If my husband gets into neurosurgery we are looking at a residency of at least six if not eight years.

Just wondering how those of you with residencies of more than three years manage to make these payments? Especially those where the spouse is a stay-at-home parent and the residency salary is the sole income.

Yikes!

[houseelf]

You can request forbearance and continue to acrue interest during that time.

Kelly

[MarissaNicole]

You can request forbearance and continue to acrue interest during that time.

Kelly

Are you serious? Can you do this as long as you are in residency? Because that would be fabulous news - I thought it was still acquiring interest during the three years anyway?

loan repayment

DH and I just went to the 4th year "exit interview", so we heard all about this stuff. Unfortunately, starting June of this year you can no longer defer your loans during residency under the "Economic Hardship". That kinda sucks...they showed us some figures that made me cringe:
Average debt of a graduating med student: $160000
Average monthly repayment under standard 10 year plan: $2600/month

That sounds like the entire monthly take home pay of a resident!! Ouch!

The good news is that they're starting a new "Income Based Repayment" plan. It's sort of complicated...in a nutshell your monthly payment is 15% of your "disposable income". They gave us a website that explains it better than I can:
http://www.ibrinfo.org/

Under that plan, I think it will be reasonable, at least for us, to live just on DH's resident income.

[oceanchild]

Right, so what they did under the last student loan bill is eliminated deferment for residency. Deferment was good because you could not pay AND not accumulate interest. Forbearance is still an option, so you still don't have to pay, but you will accrue interest.

And as I've said elsewhere, we're really counting on income based repayment, but there's still no info about how to actually apply.

[HouseofWool]

What is considered disposible income? Because I can't remember the last time we had that...

Is deferment still available? I thought I had heard that it was no longer available for residents starting this academic year.

[Pollyanna]

What is considered disposible income? Because I can't remember the last time we had that...

If you go to the income based repayment website they'll take you through a sample of what you might owe in monthly payments. We owe over $100K and our monthly payment would be around $20. Completely doable.

Does anyone know if you can still automatically defer in fellowship or has that changed as well?

[HouseofWool]

Tara - I think your payment must be greatly influenced by the number of children, because when I calculate out our $250K worth of debt and 2 kids, we get a payment of $150/month, which is not do-able at all considering DH's car will need to be replaced shortly.

[Pollyanna]

Tara - I think your payment must be greatly influenced by the number of children, because when I calculate out our $250K worth of debt and 2 kids, we get a payment of $150/month, which is not do-able at all considering DH's car will need to be replaced shortly.

Oh, sorry.

[HouseofWool]

No biggie Tara - hopefully we will be increasing our numbers in the next 2 years...

[MDPhDWife]

When I run the calculator it only asks for the annual income, not disposable income. I wonder if that is expected to change??? Also, we have about 50K and when I inputted the average resident salary of $40K with two kids it gave me an estimated payment of $90, but when I changed the dependents to three the estimated payment was drastically reduced to $20. That must be why Tara's payment came out so differently than Kris'.

Does this change affect those who are already in residency and have deferred?

[HouseofWool]

Guess this means that we will definately will be having #3 sooner rather than later...

[MarissaNicole]

DH and I just went to the 4th year "exit interview", so we heard all about this stuff. Unfortunately, starting June of this year you can no longer defer your loans during residency under the "Economic Hardship". That kinda sucks...they showed us some figures that made me cringe:
Average debt of a graduating med student: $160000
Average monthly repayment under standard 10 year plan: $2600/month

That sounds like the entire monthly take home pay of a resident!! Ouch!

The good news is that they're starting a new "Income Based Repayment" plan. It's sort of complicated...in a nutshell your monthly payment is 15% of your "disposable income". They gave us a website that explains it better than I can:
http://www.ibrinfo.org/

Under that plan, I think it will be reasonable, at least for us, to live just on DH's resident income.

So under this new plan can you still defer for three years? And after than you have to go back into repayment - you just have the option of having payments based on income?

[ides]

We were only allowed to defer for two years. This last year we have been in forebearance due to economic hardship. We are hoping we can continue with forbearance throughout fellowship. That would mean another three years (2 more in residency and 1 in fellowship). I wonder if they take the cost of living into account with these calculations. We live in nyc and half of dh's income goes to rent and I'm currently staying home with the baby so we really have no 'disposible income' to speak of.

Yikes- I just looked at the calculator and it says we'd owe $340 a month. There is no way as we are barely breaking even as it is. I guess it doesn't consider cost of living.

[oceanchild]

So under this new plan can you still defer for three years? And after than you have to go back into repayment - you just have the option of having payments based on income?

I really don't think you can defer at all any more. Just forbearance.

(I tried out the calculator with my current salary plus DH's, and it puts our repayment pretty high. Still lower than what it would be if we did "normal" payments, but high. Of course, if I can't find a job that'll change things...)