Student loan payments: get advice and actual numbers here Forum

[Danger Zone]

Your plan is sound. Make sure you also max your backdoor Roth contributions as well. Don't pay that student loan debt down any faster than is required.

Thanks - that's what I was thinking, I just wanted some reassurance. Also, I'm sure a lot of people have a wide array of views on Roth vs traditional, but I'm leaning towards going traditional. I was planning on backdooring it before the end of the year once I've got some additional capital.

The smartest investors hedge and do both.

[lawhopeful100]

Quick question. Does anyone know whether you can refinance student loans on a 3 year term? I refinanced with Sofi on a 5 year term at roughly a 6% or so interest rate. I'm about to be at one full year of making payments on time and making credit card payments on time (got my first credit card right when I refinanced as well. Never really had anything on credit before). Once I get close to the two year mark of making payments, I imagine my credit will be much better so I wanted to know if it was possible to refinance the remaining 3 years at a lower interest rate and if that is the smartest strategy. Thanks in advance.

[JenDarby]

Quick question. Does anyone know whether you can refinance student loans on a 3 year term? I refinanced with Sofi on a 5 year term at roughly a 6% or so interest rate. I'm about to be at one full year of making payments on time and making credit card payments on time (got my first credit card right when I refinanced as well. Never really had anything on credit before). Once I get close to the two year mark of making payments, I imagine my credit will be much better so I wanted to know if it was possible to refinance the remaining 3 years at a lower interest rate and if that is the smartest strategy. Thanks in advance.

If you have good credit and decent liquidity (or will in the near future) then I would look into a fixed rate refinance with first republic. Their fixed rates are WAY better than that variable (2.35% for 5yrs; 2.95% for 7yrs; 3.45% for 10yrs; 3.95% for 15yrs). You do have to be in or near a qualifying city (Palm Beach, FL; NYC; Greenwich; Boston; Palo Alto; LA, Santa Barbara; SF; Newport Beach; Portland, OR).

I can make an email introduction with my personal banker if you want to discuss it with him (we would both get a bonus of $200 if you did refinance, for full disclosure).

I refinanced my constantly rising 4% variable commonbond refi after a little over a year for a lower fixed rate with first republic. I'm happy to discuss more over PM or answer any questions here.

With a 6% interest rate you should definitely look to refinance to a lower rate (and likely longer term even). Freeing up money in both interest and principal could allow you to slow down repayment if you wanted (or not) to focus money elsewhere (savings, downpayment, emergency fund, etc) and still pay less overall.

[lawhopeful100]

Quick question. Does anyone know whether you can refinance student loans on a 3 year term? I refinanced with Sofi on a 5 year term at roughly a 6% or so interest rate. I'm about to be at one full year of making payments on time and making credit card payments on time (got my first credit card right when I refinanced as well. Never really had anything on credit before). Once I get close to the two year mark of making payments, I imagine my credit will be much better so I wanted to know if it was possible to refinance the remaining 3 years at a lower interest rate and if that is the smartest strategy. Thanks in advance.

If you have good credit and decent liquidity than I would look into a fixed rate refinance with first republic. Their fixed rates are WAY better than that variable (2.35% for 5yrs; 2.95% for 7yrs; 3.45% for 10yrs; 3.95% for 15yrs). You do have to be in or near a qualifying city (Palm Beach, FL; NYC; Greenwich; Boston; Palo Alto; LA, Santa Barbara; SF; Newport Beach; Portland, OR).

I can make an email introduction with my personal banker if you want to discuss it with him (we would both get a bonus of $200 if you did refinance, for full disclosure).

I refinanced my constantly rising 4% variable commonbond refi after a little over a year for a lower fixed rate with first republic. I'm happy to discuss more over PM or answer any questions here.

With a 6% interest rate you should definitely look to refinance to a lower rate (and likely longer term been).

Thanks for the info. I'm not near those cities and am still about a year away from when I would refinance again. I'm more curious though if I could refinance somewhere on a 3 year term. I'm looking forward to being debt free in 4 years.

[JenDarby]

The private loan servicer you look to re-refinance with should be happy to take over your loans and accept your interest even if your prior term only has 3 years left. 6% is very high. You'll likely be extending your term to a new 5 or 10 year term for thevlowe rate, but you can always make extra payments.

Look into earnest and commonbond when you're ready. There are a few people around here that can provide referal codes as well to get you both a bonus when that time comes.

[gr8scOtt!]

Yeah, when you certify for PSLF you get switched. Pretty sure they're going to find the stuff eventually - it takes them a little while to get things in place. They're not the speediest/most efficient (I haven't run into problems with them, though others have; just that they're kind of slow.)

.pslf paperwork takes forever. No surprise.

[A. Nony Mouse]

I didn't even know it showed this, frankly, and it took me ages to find where it shows up, but my payments show up as qualifying. Unfortunately I can't tell you how long it took them to mark them as qualifying because it's been a couple of years since I sent in certification (you remind me that I need to send in my my recent one).

It's a huge pain, but you're probably better off calling them and making them come up with an answer while you're on the phone. E-mail is going to go into a massive queue I suspect.

[gr8scOtt!]

Yeah, having to call is what I was afraid of lol. Probably best though.

[Nebby]

Emailing the government never works. Ever. Literally never.

I am actually pleasantly surprised by FedLoan. I submitted my first PSLF form in mid-June, and by the end of July everything had been transferred to them, account set up, and was ready to go. They also sent me the letter stating my number of qualifying payments, which was 5. They also clarified that my loans officially went into repayment and the first month for PSLF purposes was Jan 2017. They told me that so I can always check to make sure the # of qualifying payments is correct.

Also, not only does emailing the government never work, faxing them stuff sucks too. When I faxed in my PSLF form, I actually faxed it three times. Faxed it on a monday, then the next monday, and then the next monday.

Rule of thumb when dealing with the govt: always call, and always fax 3 times

Yeah, when you certify for PSLF you get switched. Pretty sure they're going to find the stuff eventually - it takes them a little while to get things in place. They're not the speediest/most efficient (I haven't run into problems with them, though others have; just that they're kind of slow.)

I signed up for pslf and my loans were switched to fedloans, and under loan info it shows how many qualifying payments I have made. Except that it shows 0 qualifying payments. I submitted the paperwork for my clerkship last November or so. Hadn't shown up as qualifying payments. Emailed January or so. Never heard back. Emailed in may or so and got a we will check into it response, but nothing since. How long does it actually take to get qualifying payments to show up?

Can you clarify? When did you graduate law school? When did you start the clerkship? When did your loans officially go into repayment? When did you submit the PSLF form?

If you are C/O 2016, then the first month that counts for PSLF is January 2017. If you submitted your PSLF form before your first payment in Jan 2017, which is sounds like you did, then the letter is going to say you have zero qualifying payments. When you send in the form, it only counts the number of payments since Jan 2017, and therefore will be zero if you submitted the form before then.

The qualifying payment tracker under your loan details does not actually update every month, either. It only updates whenever they receive a new PSLF certification, because only then do they recount the number. So right now it says 0 qualifying payments because it was 0 when you submitted your last PSLF form.

Make sense?

[gr8scOtt!]

I called. They are working on it. I had qualifying payments before my loans were switched to FedLoan. They just need to verify those payments and it takes time evidently. But they are working on it!

[Nebby]

I called. They are working on it. I had qualifying payments before my loans were switched to FedLoan. They just need to verify those payments and it takes time evidently. But they are working on it!

Good to hear!

[Anonymous User]

Debt: $201K
Payments: A little over $1,700
Income: $180K me, ~$35K l/t gf
Plan: Double up on payments, puts me around four years for total repayments

Note:

I had planned (poorly) on around $180k initially. Interest and a transfer had me up to $200k by graduation. Looking forward to attempting to pay off in four years.

But it is hard to plan for retirement, living, kids when my needs dramatically change four years out.

Lucked out getting a big law job, but I'll probably budget like I struck out.

[SmokeytheBear]

Debt: $201K
Payments: A little over $1,700
Income: $180K me, ~$35K l/t gf
Plan: Double up on payments, puts me around four years for total repayments

Note:

I had planned (poorly) on around $180k initially. Interest and a transfer had me up to $200k by graduation. Looking forward to attempting to pay off in four years.

But it is hard to plan for retirement, living, kids when my needs dramatically change four years out.

Lucked out getting a big law job, but I'll probably budget like I struck out.

What city do you live in ? If you're in a city that First Republic serves and your plan is to do it in under four years, refinance with their five year package and they refund you an amount up to 2% of your initial loan balance if you pay it off within four years. Let me know and I can give you a referral (we both get $200).

[Nebby]

Debt: $201K
Payments: A little over $1,700
Income: $180K me, ~$35K l/t gf
Plan: Double up on payments, puts me around four years for total repayments

Note:

I had planned (poorly) on around $180k initially. Interest and a transfer had me up to $200k by graduation. Looking forward to attempting to pay off in four years.

But it is hard to plan for retirement, living, kids when my needs dramatically change four years out.

Lucked out getting a big law job, but I'll probably budget like I struck out.

201k is extremely doable, even in NYC, with a biglaw job. Ditto the advice above about First Republic. With their 5 year plan, you can probably get a fixed rate around 3% (or below) with good credit. In a 4 year repayment scenario, that's basically ~$4,500/month for 4 years. (Also, you could do something like $3600/month first year, $4400/month second year, $5,000/month third year, etc.)

[JenDarby]

Debt: $201K
Payments: A little over $1,700
Income: $180K me, ~$35K l/t gf
Plan: Double up on payments, puts me around four years for total repayments

Note:

I had planned (poorly) on around $180k initially. Interest and a transfer had me up to $200k by graduation. Looking forward to attempting to pay off in four years.

But it is hard to plan for retirement, living, kids when my needs dramatically change four years out.

Lucked out getting a big law job, but I'll probably budget like I struck out.

201k is extremely doable, even in NYC, with a biglaw job. Ditto the advice above about First Republic. With their 5 year plan, you can probably get a fixed rate around 3% (or below) with good credit. In a 4 year repayment scenario, that's basically ~$4,500/month for 4 years. (Also, you could do something like $3600/month first year, $4400/month second year, $5,000/month third year, etc.)

with the rates at 2.35% for 5yrs; 2.95% for 7yrs; 3.45% for 10yrs; 3.95% for 15yrs, I wouldn't refi to a 5 year plan as a new biglaw associate with that much debt

you never know when you might get asked to leave or choose to leave, so it's too risky IMO to commit yourself to that high of a monthly payment. you're better off going with the higher (but still great) rate on a 7 or 10 year term (10 is really the sweet spot). You can always pay it off early still. the overall difference in interest you would have saved going with a 5 yr plan, if you do manage to pay off a 10 yr plan early, isn't worth the potential downsides of defaulting

and since my advice is clearly superior here, and full disclosure I would get a $300 bonus (sorry, yours is still $200), definitely PM me if you want a referral to FRB! lol

[Pokemon]

Debt: $201K
Payments: A little over $1,700
Income: $180K me, ~$35K l/t gf
Plan: Double up on payments, puts me around four years for total repayments

Note:

I had planned (poorly) on around $180k initially. Interest and a transfer had me up to $200k by graduation. Looking forward to attempting to pay off in four years.

But it is hard to plan for retirement, living, kids when my needs dramatically change four years out.

Lucked out getting a big law job, but I'll probably budget like I struck out.

Consider repaye particularly if no rich family/safety net etc. If you get shitcanned a year from now it would not matter if lowered your debt from 200k to 150k, but having 30k in bank could be useful.

[ZVBXRPL]

Hey. What's the consensus: do I go with private loans or subsidized? will take out 180k

Noobie so not so well versed on loans.

[Nebby]

Hey. What's the consensus: do I go with private loans or subsidized? will take out 180k

Noobie so not so well versed on loans.

Federal loans

[Anonymous User]

Hey. What's the consensus: do I go with private loans or subsidized? will take out 180k

Noobie so not so well versed on loans.

Federal loans

Why?

[A. Nony Mouse]

You don't know until after you've entered law school (sometimes not till after graduation) that you're going to get a job that will let you pay back those loans comfortably. The income-based repayment plans that cap your payments at a percentage of your income are only available on federal loans, not private. If something catastrophic happens and you're without work for a stretch with private loans, you have the payment hanging over you (maybe you can get forbearance - I don't know how that works - but it won't do anything toward paying off your loans). If you have federal loans and your income is low enough, you don't have to pay, but the "payment" of 0 will still count toward the 20 years of payments you have to make before forgiveness.

Private rates are usually lower so lots of people who end up in biglaw refinance their federal loans with private lenders after they graduate, when they know they have a job (and ideally have a sense of how long they'll be able to stay in it). But taking out private loans before you know what job you're going to do after graduation (or if you'll be employed at all) is pretty risky and most people prefer to have the protections of federal loans.

[Mr. Peanutbutter]

Also rates are rising and the difference between the two is likely negligible unless you have a cosigner with huge income and great credit.

The freedom afforded fed loans can't be beat.

[beach_terror]

My blood pressure rises an unhealthy amount every month when I get the "LIBOR Rate Change Notification" email from SoFi.

[Anonymous User]

Looking for advice on whether to jump into PSLF.

I have around $200k in student debt (all federal) and am married to a spouse with no student loans. Just finishing up a clerkship and about to begin a position at a federal agency. The plan is to remain in government/public interest.

My school has a loan assistance program which I've been on since graduating. That program puts you on a 10 year repayment plan and indexes what you need to pay per month based on your salary. The school then covers the rest of my monthly payment. I've been looking at PSLF, and if I was to jump into that I'd pay substantially less per month (like around $500 less), and so I'm considering whether I should start that.

Whether I stay in my school's program or jump into PSLF, my loans will be paid off in 10 years, but under PSLF I'll have paid substantially less. However, I'm worried about the risk of relying on a program that's subject to the whims of Congress. Any advice? Should I save money and go with PSLF, or pay extra for the safety of a program I know won't go away?

[Nebby]

Looking for advice on whether to jump into PSLF.

I have around $200k in student debt (all federal) and am married to a spouse with no student loans. Just finishing up a clerkship and about to begin a position at a federal agency. The plan is to remain in government/public interest.

My school has a loan assistance program which I've been on since graduating. That program puts you on a 10 year repayment plan and indexes what you need to pay per month based on your salary. The school then covers the rest of my monthly payment. I've been looking at PSLF, and if I was to jump into that I'd pay substantially less per month (like around $500 less), and so I'm considering whether I should start that.

Whether I stay in my school's program or jump into PSLF, my loans will be paid off in 10 years, but under PSLF I'll have paid substantially less. However, I'm worried about the risk of relying on a program that's subject to the whims of Congress. Any advice? Should I save money and go with PSLF, or pay extra for the safety of a program I know won't go away?

I think you may be confusing PSLF with PAYE or other income-based repayment plans. PSLF would not reduce your monthly payments. PSLF is not a payment plan.

Payment plans are either standard (such as the standard 10 year repayment plan, which is sounds like you're currently on?) or income-based repayment plans (such as PAYE, which ties your payment to 10% of discretionary income).

PSLF is a forgiveness program. It merely forgives your remaining debt after 120 qualifying payments.

[Anonymous User]

Looking for advice on whether to jump into PSLF.

I have around $200k in student debt (all federal) and am married to a spouse with no student loans. Just finishing up a clerkship and about to begin a position at a federal agency. The plan is to remain in government/public interest.

My school has a loan assistance program which I've been on since graduating. That program puts you on a 10 year repayment plan and indexes what you need to pay per month based on your salary. The school then covers the rest of my monthly payment. I've been looking at PSLF, and if I was to jump into that I'd pay substantially less per month (like around $500 less), and so I'm considering whether I should start that.

Whether I stay in my school's program or jump into PSLF, my loans will be paid off in 10 years, but under PSLF I'll have paid substantially less. However, I'm worried about the risk of relying on a program that's subject to the whims of Congress. Any advice? Should I save money and go with PSLF, or pay extra for the safety of a program I know won't go away?

I think you may be confusing PSLF with PAYE or other income-based repayment plans. PSLF would not reduce your monthly payments. PSLF is not a payment plan.

Payment plans are either standard (such as the standard 10 year repayment plan, which is sounds like you're currently on?) or income-based repayment plans (such as PAYE, which ties your payment to 10% of discretionary income).

PSLF is a forgiveness program. It merely forgives your remaining debt after 120 qualifying payments.

Sorry if I was unclear. I know PSLF isn't a repayment plan, I was using it for shorthand to say that I would change from a standard 10-year repayment plan (which my school's LRAP requires us to be on) to REPAYE or IBR (in order to take advantage of PSLF).

Essentially my question is whether to stay on my school's LRAP (under which my monthly payments would be higher but there is no risk of the program ending and my loans would be fully paid off after 10 years) or go instead for PSLF (which would mean getting on REPAYE, having lower monthly payments, and hoping that the program will still exist 10 years from now). Does that make sense?