Thank you for your calculations.
Considering the $440,000 each of the brothers owe presently contains a fair amount of debt accumulated in dental school, possibly $40,000, the actual amount they borrowed, less interest and origination/administrative fees, for schooling may be closer to $400,000. Their total PAYE payments and tax liability, as you point out over a 20 year period, are $694,000. Very reasonable. They will pay only $294,000 over the actual amount they borrowed to pay for schooling. Their total payments of $694,000 are comparable to approximately a 5%+ interest rate over 20 years on the $400,000 they borrowed. As you stated, at their starting incomes standard repayment plans are not feasible (7.25% at $3,000/month for 30 years or $5,165/month for 10 years). To earn more means these brothers will have to take on considerable and additional business debt and responsibility. If they work together, they will lower total business debt, but they will have to work soundly together in partnership for a very long period of time for it to pay off. Any hiccups in their relationship could prove costly. I think the 20 year AGI of $300K may be a little steep considering we are possibly in a protracted low inflation period when it comes to wages, and additionally insurance companies are lowering fee schedules, the cost of equipment and supplies are increasing, there are an increased amount of dentists graduating, many new schools have opened, and older dentists are retiring later, increasing competition, less patient demand and increasing employee salaries. Any and all in combination may lower the expectations of dentist's AGI's going forward.
From your calculations, if a borrower goes into PAYE and saves their tax liability and has it ready when it is due, they will pay close to what a borrower on the standard 10 repayment plan pays: $694,000 vs $619,800 - $5,165 x 120 months compared to the 30 year standard payment plan of $3,000 x 360 months, $1,080,000. The advantage of PAYE in this instance is predicated on the borrowers due diligence in saving their tax liability and having it ready when due, and also no changes in treatment of student loan forgiveness by either the IRS or the Department of Education.
A question, as a large number of people get divorced, if the PAYE/IBR borrower who is saving his/her money to pay off their eventual tax liability divorces before the tax liability is due, does the ex-spouse have rights to half of this asset prior to using it? Can the borrower protect this money from a potential divorce while it is being accumulated so it is never an issue?