Pete:
I know this is a long and confusing question, but frankly, I’m confused. And I’m wondering if you can shed some light on this. Thanks again for all your help. I appreciate everything you do.
And it also only very goes that those finance which you had for med school had been these types of loved ones, government training financing, and these just weren’t qualified to receive public-service loan forgiveness
Dr. Jim Dahle:
Do we know about this, Andrew? Yes. We know about this. We’ve been talking about this for months.
And it merely thus goes that people loans that you had getting med college or university were these types of friends, federal knowledge money, and these just weren’t entitled to public service mortgage forgiveness
Dr. Jim Dahle:
Yeah. So, give him the answer. What’s the scoop on this new PSLF waiver that goes through Halloween?
Andrew:
Yeah. Recently, this came out on e out and what this has done is it’s shaken up a lot of the world for public service loan forgiveness. And the reason why they’ve been able to do that is, in the event of a national emergency or war, essentially, the legislators can change up student loan law, albeit temporarily, which COVID has fit within that realm.
Andrew:
And so, essentially the payments that you https://www.paydayloansmissouri.org/ have made, any payment, as long as you have qualifying employment should qualify. And you detailed one of the key steps is doing a direct federal consolidation. Because in the old rules, when you completed a consolidation, what it did is it erased all of your prior payment history. And we have run into this time and time again with so many clients that like you graduated med school in the 1990s or early 2000s.
Andrew:
Essentially, you got the short end of the stick, just because you borrowed before 2007, 2010, when a lot of the newer loans, these direct federal student loans, were starting to get issued.
Simply speaking, yes, the next phase should be to over a primary government integration. Immediately after that experiences, next in that software, you’re going to have to look for a payment bundle, however, I’m of course, if you already generated the brand new 120 costs. You don’t have to make alot more repayments right after which you are able to need to approve your own a position, use a work qualification function, following a couple of way more months to go, and then you will be able to get the quick income tax-free mortgage forgiveness.
Also it only very goes that those fund you got to own med school was in fact these types of family members, government degree funds, that just weren’t eligible for public-service loan forgiveness
Dr. Jim Dahle:
Yeah, it’s awesome. It’s basically been expanded this year. Even people that didn’t meet the requirements in the program, when the program was introduced, it just got a whole lot more lenient. And that was actually president Biden taking advantage of the COVID emergency to put some emergency rules in place. Take advantage if you can.
Therefore simply therefore happens that people funds which you got to own med college was indeed these friends, government knowledge fund, and they just weren’t entitled to public-service loan forgiveness
Dr. Jim Dahle:
All right. Our next question is from email, it’s actually a two-part question. The doc introduces it. “I’m an academic physician about two and a half years out from training, definitely pursuing PSLF with about 100 qualified payments to date.”
And it also just thus goes that those fund which you had for med college was in fact these types of family members, government education fund, and they were not entitled to public-service loan forgiveness
Dr. Jim Dahle:
He has two questions. The first one, “In addition to funding retirement and a six-month emergency fund, I’ve been saving a PSLF side fund in a high yield savings account. My PSLF side fund will equal my med school debt burden, which is now $325,000 with over $120,000 in interest on top of $200,000 in principle.
Therefore simply thus goes that those finance that you got to possess med university was this type of family, federal degree money, that weren’t entitled to public service mortgage forgiveness
Dr. Jim Dahle:
I anticipate that at that time, my attending level monthly payments will be large enough to finally cover the accruing interest and that my debt won’t grow meaningfully in my final year, year and a half of qualified payments.
Plus it just so happens that those finance that you got to have med college or university had been such family relations, government knowledge loans, and they just weren’t eligible for public service financing forgiveness
Dr. Jim Dahle:
What do you recommend I do with the side fund during that time? I know a high yield savings account is the most risk-averse option. Do I just leave it there earning less than 1%? The rest of my personal investments are in low-cost index funds. When would you start adding some of those PSLF side fund monies into index funds too?” Why don’t you give your take on this Andrew, and then I’ll give mine?