A Shot Over the PSLF Bow

[SigmaFS]

WSJ article focuses on the 'doctors' loophole':

http://www.wsj.com/articles/u-s-student-loan-program-proves-costly-1448042862?alg=y

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[Postictal Raiden]

The PSLF program is unsustainable and will most likely phase out or modified to prevent high earners from taking advantage of it. On the other hand, I highly doubt that IBR/PAYE/REPAYE will go away.

Personally, I wish the gov't do away with all these programs and reduce the interest rates to 3-4% (a fraction above inflation rate).

 

[Perrotfish]

The PSLF program is unsustainable and will most likely phase out or modified to prevent high earners from taking advantage of it. On the other hand, I highly doubt that IBR/PAYE/REPAYE will go away.

Personally, I wish the gov't do away with all these programs and reduce the interest rates to 3-4% (a fraction above inflation rate).

IBR/PAYE/REPAYE all need to survive 20 years of political turmoil, though. In some ways PSLF is a better bet.

What I wish is that they'd make the payments incremental, rather than a lump sum at the end of the program. There's no way to take advantage of the program without allowing your debt to balloon to levels where you can't pay it down, and there's no way to pay your loans down without feeling like a chump because PSLF is so much cheaper.

 

[68PGunner]

WSJ can focus on whatever loophole that current exists in this legislation. Obama has wanted to put a cap on this program in the past two years. My guess is that nothing will get done until the next recession in 4-5 years. By then, all current students will be grandfathered into the program.

 

[68PGunner]

In most cases even with max deductions, the total of that 120 payments is equivalent to the original principal of the loan. In the grand scheme of things, it's like giving docs a interest free loan in order to practice in underserved areas.

 

[chompsss]

It's scary as hell to think that some of us are making decisions now on loans based on programs (PSLF and IBR/PAYE etc.) that can be pulled out from underneath us at any time.

 

[Igor4sugry]

In most cases even with max deductions, the total of that 120 payments is equivalent to the original principal of the loan. In the grand scheme of things, it's like giving docs a interest free loan in order to practice in underserved areas.

Not necessarily. Particularly if you do long residency/fellowship. Say you are 6 years in training (residency +/- fellowship) and start residency with 250k in loans. During this time you will pay very little based on IBR calculation for these 6 years. Then you will enter attending salary, but for first 6months payment will be low too because your full income hasn't kicked in yet. Then you will have 3.5 years left at full repayment. The amount you will have paid will be much less than 250k.