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Biggest Mistakes Doctors Make With Their Student Loans and PSLF In Residency

Editor's note: President Biden has completed an extensive overhaul of the PSLF and IDR rules that will benefit most resident physicians. Residents and fellows will want to choose between the new SAVE plan (formerly REPAYE), which heavily subsidizes interest, and PAYE / NEW IBR, which allows for capped payments. The other mistakes borrowers make with student loans in residency are listed below still apply.

Doctors are perhaps the most prone of all occupations to making student loan blunders, because they have the most student loan complexity of any profession. One of the biggest reasons is that many don't fully understand how to take advantage of the special benefits available for student loans in residency or fellowship.

Residency can count towards PSLF, but doctors must meet certain conditions for student loan payments to qualify. This includes working for a PSLF-eligible residency program and choosing the right student loan repayment program.

If you have federal student loans and you're planning to work for a not-for-profit hospital after training, you must understand student loans rules surrounding PSLF. Medical students and recent grads could lose out on tens or hundreds of thousands of dollars by making the wrong decisions with their student loans in residency.

Common Resident Physician Student Loan Mistakes

With Biden's new income-driven repayment plan (IDR), even doctors planning a future in private practice could make huge and costly mistakes from not understanding common student loan pitfalls in residency.

If you're a medical resident with federal loans, here are the biggest student loan mistakes you'll want to avoid now that payments have resumed following the COVID-19 forbearance period.

1. Failing to consolidate med school loans

The average student loan debt for a medical student is just north of $200,000, according to the most recent data from the Association of American Medical Colleges (AAMC). Many of those students wonder, “Do you pay students loans during residency?” The answer is yes.

That might seem like a bummer at first. After all, your resident income will likely be much lower than your attending salary. However, that lower resident income could also qualify you for lower payments since IDR plans use your discretionary income to determine your payment amount. And it could potentially help you maximize student loan forgiveness.

If maximizing forgiveness is your goal, consolidate all your federal student loans at the beginning of residency into one federal Direct Loan. You should aim to do this during your grace period before repayment begins. All Direct Loan borrowers can do this, regardless of credit score or income.

By consolidating, all your student loan debt will be eligible for the Public Service Loan Forgiveness program. Moving forward, each year of medical residency or fellowship will count towards the 10 years of qualifying payments needed to reach tax-free loan forgiveness.

Note that private student loans aren't eligible for a Direct Consolidation loan and may not offer a grace period after you finish medical school. If you have private medical school loans, you may want to consider student loan refinancing. A few student loan refinancing lenders offer reduced payments for medical residents. Some even provide a grace period after residency ends, before you're required to make payments.

Get Started With Our New IDR Calculator

2. Failing to work for PSLF-eligible employers

If your only choice is a residency at a for-profit hospital or none at all, then it's not really a choice. But if you have any say, try to make sure you end up at a program at a nonprofit hospital.

It's important to note that not all residencies will qualify as PSLF residency programs and that working for a hospital doesn't automatically qualify you for student loan forgiveness. To qualify for PSLF, you must take a full-time “qualifying public service position.” PSLF residency programs are typically 501(c)(3) nonprofit organizations or state hospitals. According to the Association of American Medical Colleges (AAMC), example qualifying fields may include:

  • Emergency management
  • Government
  • Military service (active duty)
  • Public safety
  • Public health

Medical professionals could discover that their residency doesn't count toward loan forgiveness if they don't work for a qualifying employer. If you plan to pursue PSLF after residency, it's imperative that you narrow your search to PSLF residency programs, or you won't cover any ground toward PSLF during your residency. To verify an employer's eligibility, contact MOHELA or use the PSLF Help Tool.

As an attending, you also want to investigate employer eligibility. Usually that will be easy to see as your employer needs to be a public sector employer or a 501c3 not-for-profit organization. Note that some previously ineligible employers like Kaiser Permanente now qualify as well.

3. Failing to submit the PSLF Employment Certification Form annually

student loan mistakes doctors make in residency

If you're in medical residency or fellowship, this PSLF form from the federal financial aid office should be your best friend. Very few residents ever submit the form though. A common misconception among residents is that the PSLF program automatically results in loan forgiveness once you're eligible.

This idea is probably the most common of the PSLF mistakes. Nothing could be further from the truth. You have to apply after working for a public service (not-for-profit) institution for 10 years.

Unfortunately, a lot of doctors will make payments for 10 years and be in for a rude awakening when they submit this form. Some folks will have loans they failed to consolidate, as I warned with Mistake #1. In that case, all your loans without “Direct” in the name aren't even eligible for forgiveness. Others will have to deal with the horrible record-keeping of federal loan servicers.

Our Personal Example Should Drive Home How Important Submitting the PSLF Form Really Is

Let me give you a personal example. My wife submitted the PSLF certification form to the U.S. Department of Education. The financial aid office transferred her from Nelnet to FedLoan Servicing, which previously handled all PSLF cases (now MOHELA has that responsibility). They returned her form with the shocking answer that she had only made two of the 120 loan payments required for PSLF.

This answer is totally wrong and is an example of extreme incompetence. She consolidated everything into a Direct Consolidation Loan at the end of medical residency. And she had made at least three years' worth of loan payments during fellowship. But she only submitted the PSLF certification form at the end of her fellowship, instead of during her first or second year of residency. So their record-keeping was completely off.

The PSLF paper trail is a beautiful thing

So what do you get with submitting the PSLF certification form annually? You get a paper trail and proof that you're progressing in the program. If you submit the form each year, you will have proof that you made each payment.

This has proven especially important when borrowers have had to deal with the previous loan servicer, FedLoan Servicing. So, begin as soon as you get your first couple paychecks in residency and begin to make payments on your loans. Submit the form to know exactly where you stand in regard to the PSLF program.

4. Failing to choose the right med school loan repayment program

Here's the honest truth: your financial aid officer is going to give you a one-size-fits-all answer regarding your student debt repayment options. Few financial aid counselors consider your career, marriage, or life plans. And even fewer input them into a spreadsheet to simulate the cost of each option.

But choosing a repayment program is complicated. The right choice for you will depend on your life plans, goals, future income, and more. We consider all of these factors during our student loan consultations. But, for now, here's some general guidance.

Saving on a Valuable Education (SAVE), Pay As You Earn (PAYE) or Income-Based Repayment (IBR) are good options if you expect a surge in income, your training period lasts four to six years, or your spouse has a high income. If that's the case, then you should consider filing taxes separately. That way, the monthly payment is based on only your income instead of your spouse's income too.

Also note that PAYE and IBR place a cap on total monthly payments based on the 10-Year Standard Repayment amount. However, SAVE (formerly known as Revised Pay As You Earn, or REPAYE) has no such cap.

5. Not Taking Out and Keeping the Max in Federal Student Loans that You're Eligible For

With the new IDR plan from Biden allowing you to receive huge interest subsidies, taking out the max in federal student loans will be like an extremely low interest loan.

Furthermore, with new PSLF rules expanding the pool of eligible employers for physicians, there's a very high chance your loans will be forgiven tax-free anyway.

So a huge mistake might simply be trying to pay down your loans during residency. As a med student, the mistake would be not maxing out all the loans you can get for all eligible costs, such as living expenses.

An Example of Student Loan Errors During Residency

I'd like you to meet Tim, a soon-to-be-attending physician finishing up his five-year medical residency program. He's really excited about the new contract he signed with a major academic medical system that is a qualifying public service employer for PSLF.

Tim has $200,000 worth of education loans with an interest rate of 6.8%. His contract stipulates a starting salary and bonus of approximately $250,000 in the first year. He expects his salary will grow to about $300,000 over the next five years.

Unfortunately, Tim made nearly all the wrong moves with his federal student loans in residency. While he did work for one of the PSLF residency programs, he never submitted the PSLF form. He never consolidated his loans. And he never checked to see if there was a better repayment plan than IBR.

PSLF might be off the table for this physician

Tim discovers that because he did not consolidate his old loans, the five years of IBR monthly payments he made during residency do not count towards PSLF. His loan balance is higher than it would have been otherwise too, because he never looked into other income-driven repayment options.

If Tim paid attention to this blog, then he would have known to submit for the IDR waiver, which would have eliminated this mistake. There's always tricks and temporary programs to save more money in the student loan business.

For this example, I will compare the cost of IBR and private refinancing with the PSLF program, if Tim had not made the student loan mistakes doctors make in residency. I'll model his loans using the Student Loan Planner® Calculator.

To reiterate, Tim's only real options now are refinancing to a lower interest rate with a private lender or joining the IBR program. I'm only showing the cost of PSLF to expose how much money was left on the table.

student loans residency

Tim's only real cost-saving option now is student loan refinancing. Comparing PSLF with the cost of refinancing to a lower interest rate, we see that Tim cost himself over $80,000 by not knowing student loan rules. If he had not made these mistakes, he would have been eligible for tax-free loan forgiveness in just five short years.

How to save money on student loans in residency

If you're still in medical school or are just starting your residency or fellowship, you can avoid these student loan mistakes. All you have to do is consolidate your loans within a year of starting residency. Then, file the PSLF employment certification form annually.

Additionally, make sure you choose an intelligent repayment plan that can provide low monthly payments today and (hopefully) forgiveness down the road.

Avoid the three common student loan mistakes I mentioned, and you'll be ahead of 90% of other doctors. If you plan to go into private practice and have a good credit score, you may also want to consider refinancing your med school loans and planning for an aggressive pay off. Whether you're a medical resident who wants to lock in today's low interest rates, or you're already working in private practice, it could make a lot of sense to refinance.

Student Loan Planner® can help you save money on your medical school student loans. Our advisors perform holistic loan analysis to see what your best available repayment options are. We've helped more than 13,000 clients take on over $3 billion of student debt, and we'd love to help you too.

Not sure what to do with your student loans?

Take our 11 question quiz to get a personalized recommendation for 2024 on whether you should pursue PSLF, Biden’s New IDR plan, or refinancing (including the one lender we think could give you the best rate).

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Comments

  1. Dr. Mike October 28, 2016 at 3:41 PM

    What if you were going into a high paying specialty and didn’t expect to use Pslf. Should you still use the government programs or are there other options out there?

    • Travis October 28, 2016 at 5:44 PM

      Well you could actually take full advantage of PSLF even going into a high income field like Ortho/neuro/derm/plastics/etc. You would want to use IBR or PAYE, set up the loans correctly at the beginning of residency , and you would still save hundreds of thousands of dollars. If you went private practice right after training , then the best option is probably refinancing with a private lender. I have large refinancing bonuses I’ve negotiated w lenders , so if that applies to you let me know

  2. Lai October 29, 2016 at 2:07 PM

    Are there similar options for veterinarians? Vets graduate with just as much debt but very little earning potential and work in the private sector. Are there any loan forgiveness programs for vets?

    • Travis October 29, 2016 at 9:04 PM

      Yes the PSLF program is for vets if you’re willing to work for a not for profit full time

  3. OMS-1 October 30, 2016 at 6:41 AM

    Isn’t there a “tax bomb” on the remaining loan balance after 10 years under PSLF? Tax bomb meaning you add the remaining loan amount to your years income and you pay the tax on that.
    Also, what do you think will happen with the proposed PSLF cap of ~57k?
    My plan was to utilize IBR/REPAYE/PAYE until I hit residency. Then I would utilize PSLF after the 10 years.

    • Travis October 30, 2016 at 3:10 PM

      PSLF is tax free. That means the forgiven amount DOES NOT get added to your income, in stark contrast to folks using the for profit loan forgiveness program, which DOES get added to your debt. So there is a tax bomb but not for doctors who use the loan program correctly. That’s one reason so many people reach out for consults because a couple hundred bucks is a small price compared to the cost of a mistake with PSLF.

      Great question on the 57k. You’re referring to Pres. Obama’s proposal to cap forgiveness under PSLF to $57,500 in the 2016 budget, which didn’t pass. Republicans have sought to repeal the program all together, but they specifically exempted people already in the program. I would highly suggest you get your loans set up for PSLF, file the employment certification form, and use the correct repayment plan to minimize payment while saving aggressively in an outside investment account to hedge what happens with legislation. If you’d like help of course, feel free to hit me up at travis@studentloanplanner.com. I offer a 100% satisfaction guarantee.

      • Guest May 25, 2017 at 8:37 PM

        Has anyone actually been paid out yet under PSLF?
        Hypothetically, under PSLF/IBR – if someone had $100k when graduating med school and paid in for 7 years during residency/fellowship, then had $130k balance at that time, then paid in based on “attending” salary for years 8,9,10 – and lets say had a remaining balance of $75k at the end of the 10 years, that balance would be forgiven, correct??
        Thanks in advance for your insight.

        • Travis May 25, 2017 at 9:41 PM

          That’s correct, and no one has gotten forgiveness yet, that starts Oct. 2017 for a tiny amount of people

  4. Dr. E April 1, 2018 at 6:29 PM

    Can you join REPAYE if graduated dental school, currently in residency and as such designated as “In School Status” ?

    • Travis April 1, 2018 at 8:15 PM

      Yes you can request an in school deferment waiver instead in this specific case.

  5. Dr. Len April 20, 2018 at 2:40 AM

    Do I still have to send the form every year if I’m training at the same institution? Ex) I consolidated loans before starting residency; filled out the form after my pre-lim year and have those qualified payments on MyFedLoan. Now I’m in a training program at the same institution for a total of 4 years, but since the form says start and end date, I should be able to just fill it out at the end of residency as I’ve been making my qualifying monthly payments the whole time, correct? Thanks!

    • Travis April 20, 2018 at 5:24 AM

      The form is easily uploaded online now, and the main purpose for certifying yearly is bc of how bad FedLoan is with keeping records. I’d do it every year, even though you don’t have to, as a form of insurance.

  6. Jd May 7, 2018 at 4:32 PM

    My residency is in a for profit hospital, I never consolidated or filled out the PSLF paperwork. Have about 420k in federal loans,currently on pay as you earn repayment system, I will be doing around 2-3 years of additional residency training before becoming an attending. Would it be in my interest to specifically look for a not-for-profit employer when I’m done and looking for a job? Any other advice appreciated.

    • Travis May 8, 2018 at 9:36 PM

      That or possibly even looking for a not for profit fellowship. 420k is “not bad” if you become a high earning specialist in a private practice setting. But it would be a big motivator for me in my job search if I was a lower earning physician. Maybe even consider transferring residencies if you’re going to have to wait an additional 3 years until the clock would start.

  7. JJ June 12, 2018 at 7:19 PM

    Hey Travis, quick question.. so i didn’t match last year and I had applied for IBR and was making $0.00 payments last year. I recently got an email to renew my IBR and I got into a residency this year, which I will be starting in 2 weeks. Do I wait for my residency to start and then renew my IBR or should I just renew it now? Thanks for your time.

    • Travis June 12, 2018 at 8:19 PM

      Renew it now! You’ll get the benefit of $0 payments throughout your first year, which means 0 dollar PSLF qualifying payments. Congrats for matching! Happy for you JJ!

  8. AA October 9, 2018 at 4:38 PM

    Hi. Thank you for the post! I recently graduated from residency and I’m working at an academic institution. I have been in the IBR program since 6 months into my internship but I never filled out the annual certification form. I’m trying to do that now. Who do I get to sign the form? My program director or someone from HR? Or should I call HR and request for copies of my W2 or paystubs while I was a resident? Of note, I did my intern year at a separate institution from the rest of my residency so I’d need to contact two institutions.

    Thank you!

    • Travis Hornsby October 9, 2018 at 4:58 PM

      I would ask the program director if you want to get a faster response. That said, most HR departments at hospitals should be extremely familiar with this form by now. I would try program director first then try HR for the 2 separate places. Let us know what you find out!

  9. colton October 16, 2018 at 8:30 PM

    I worked at a non-profit hospital for a few years before I started Med school (I’m an M2 right now). I made payments when I worked there, for my undergrad loans using IBR. Is it possible for me to submit a form now to FedLoans to get “credit” for paying those monthly payments on time?

    • Travis Hornsby October 17, 2018 at 8:20 PM

      Not for your med school loans unfortunately.

      • Colton October 18, 2018 at 4:27 PM

        But for my undergraduate loans, I could still submit one even though it’s been a couple years?

        • Travis Hornsby October 23, 2018 at 9:55 PM

          Yes but it wouldn’t help you that much. But yes the undergrad loans only should qualify.

  10. John Mosley November 27, 2018 at 2:58 AM

    I am gearing up to apply for residency this coming year. How can I be sure that the residency programs I apply to will qualify for PSLF, so that I can start making payments that will count toward my 10 years right away?

    I understand the general criteria (Governmental organizations – Federal, state, local, Tribal; 501(c)(3) organizations; not-for-profit organization that provides specific public services, such as public education or public health) but I have also seen people who work for hospitals that are considered public but are hired by a private for-profit subsidiary. Is there a list of programs anywhere that are eligible?

    Thanks for the article and for your help!

    • Travis Hornsby November 27, 2018 at 5:26 AM

      I would just ask if the hospital you’re working for is part of a for profit corporation like HCA. Most hospitals like Kaiser that place attending physicians in for profit groups do not do this for residents. So I would just ask residency programs about this at interviews or after you get accepted.

  11. YSK December 11, 2018 at 3:13 AM

    Hi, is it true that if I made 0 dollars in 2017, I can pay 0 dollar month loan payments that still count towards PSLF? And if so, how? I just started residency this year and loan payments are coming up at the end of the year. Thanks!

    • Travis Hornsby December 11, 2018 at 6:08 PM

      There’s competing beliefs about this. You can check “my income hasn’t changed” and pay based on the 0 income on the theory that you havent earned the taxable income for the entire year yet. I think this is a legit way to handle it. We’d need guidance from Dept of Ed if this wasn’t ok because most people do this currently.

  12. Jack Rab February 12, 2019 at 8:27 PM

    How much would you consider as high paying for a spouse?

    • Travis Hornsby February 12, 2019 at 9:06 PM

      In terms of what a high income is for a spouse? Anything over 60k already puts you in the top half of households in America and thats with an individual income.

  13. Joe February 16, 2019 at 3:01 AM

    Hello, thank you for this wonderful information. I am currently a 4th year psych resident in a city hospital about to graduate this july. I am going to a university hospital next year doing fellowship for one year & planning to start a government job at VA hospital. Unfortunately, I did not know about loan forgiveness program until now and did not fill out any yearly form.
    1. Can I not claim last 3-4 years payments I had made through income based plan then? Is still worth a try to mention on my Public Service Loan Forgiveness Employment Certification Form to see if I still get credit?
    2. All my loan names have “Direct” before them. Do I still need to consolidate?

    Thank you!

    • Travis Hornsby February 16, 2019 at 6:34 AM

      DO NOT consolidate. That would wipe your credit. Send in the certification forms for pslf and you should definitely have at least 3 years in the bag towards the 10 you need.

  14. nld March 18, 2019 at 2:22 PM

    Such a helpful start to planner our financial future! Thank you for the article.

    My significant other just matched pediatrics, he will likely do a fellowship immediately after. Thus he will be an attending in years 7-10 of the PSLF. Per your comment “60k high income spouse”, I suppose I would fall into that category now, during his lower income years (~$150k/combined..once we are married in ~2 years). It is likely by year 7, I will not be that same high earning spouse due to staying at home. I realize that each couple has different timelines and goals, do you have a income threshold to assist in making the REPAYE or IBR/PAYE decision?

    I appreciate the tip on filing the PSLF form annually. Submit it for the government paper trail and keep it for your own records!

    • Travis Hornsby March 18, 2019 at 6:42 PM

      If you have no debt then filing separately with PAYE is often a good decision. It’s dependent on a lot of things though. Feel free to add more info if you like.

  15. ama April 22, 2019 at 11:56 AM

    Hi, I am getting ready to graduate next month and will have 4 years of training (in a high earning potential field). I want to do REPAYE to limit how much I pay during residency. I have a small amount of Perkins loans. I plan to consolidate the rest of my loans (a mix of direct subsidized and unsubsidized loans – about 205k total).

    Can I apply for deferment on my Perkins loan during residency? Or should I go ahead and consolidate it with the rest of my loans? Thanks for the help!

    • Travis Hornsby April 22, 2019 at 10:43 PM

      I’d include the Perkins manually in the consolidation

      • Ama April 23, 2019 at 1:24 PM

        Thanks for the reply. I will mostly likely be doing that. I am just trying to understand if deferment is even possible on Perkins during residency? If so, I probably will still include them in the consolidation but it would give me something to think about.

        Thanks a lot for your help!

  16. John April 29, 2019 at 6:38 PM

    Thank you for this great article! I’m wondering if you/someone could provide some insight into my plan for student loan repayment. I’ll include the details below–would appreciate any input! Secondary question is whether or not I should/could consolidate loans with my wife. Again, thankyou!

    I’m recently married (filing jointly) and graduating medical school this May. I have $312k in loans and my wife has $13k. I’ll make a typical resident salary ($53k) for 4-5 years, and then expect to make around $273k after training. My wife plans to stay at home with our daughter starting this month.

    My plan:
    1. Go for PSLF and maximize benefits by:
    a. IDR with REPAYE for interest subsidy
    b. Consolidate loans after graduation from med school to kickstart $0/m payments
    c. Maximize tax-deferred contributions to further reduce payments
    2. Set aside the difference between my REPAYE payments and the standards 10-year payments into a side account as PSLF insurance
    3. Create paper trail of payments and recertifications annually/biannually

    Thankyou!

    • Travis Hornsby April 30, 2019 at 1:23 PM

      You shouldn’t (and cant) consolidate the loans w your wife. But this is a solid plan, with the caveat that you might benefit from PAYE and caps on your payment if you were going into a high paying specialty or if you lived in a community property state. also you’d consider PAYE filing separate if your spouse had a significant income.

      • John April 30, 2019 at 1:32 PM

        Thankyou!

  17. Dan May 17, 2019 at 8:12 PM

    Great article! Wanted to know if this is a good plan or not. I’ll have about 111K loans graduating this year. Single, no kids. My goal is trying to pay it all off ASAP and not do PSLF. I was considering just paying it off with the Graduate program (will be tough but I can probably pull it off) until I found out about REPAYE. I have 4 federal loans, 2 from direct unsub and 2 grad plus. I’m thinking now consolidating my loans and doing REPAYE till I finish residency, maybe pay extra towards my loans with money saved. Then after residency I would get it refinanced to a lower rate and pay it off as much as I can quickly. What are your thoughts on that?

    • Travis Hornsby May 18, 2019 at 1:09 PM

      If you’re doing private practice REPAYE sounds great. If there’s a chance you might not, then that’s not a good plan and you should check out PAYE w capped payments even on only 111k

  18. AP May 22, 2019 at 3:25 PM

    Hi, what would you recommend doing if lets say there is about 150k in federal loans and 50k in private loans? Would it better to just refinance them all as there might not be enough left at the end of 10 yrs for pslf (given that you will be making a typical resident and then general practitioner salary). I think I would rather pay off with lower interest rate then realize there is not much left to be forgiven? Thank you!

  19. Madeline Neumeier May 29, 2019 at 1:08 PM

    What is the benefit to REPAYE vs PAYE or New IBR? If the payment amounts under all three are calculated with the same 10% of discretionary income and 150% federal poverty line factors.

    • Travis Hornsby May 30, 2019 at 5:46 PM

      REPAYE has interest subsidies and PAYE has capped payments and the ability to file taxes separate and exclude spousal income. New IBR is the same thing as PAYE basically, but PAYE and REPAYE are very different.

  20. Logan Greenblatt June 29, 2019 at 6:10 AM

    For PSLF to work you have to make 10 years (120 payments) of qualified contributions, and residency, which can be 3 years counts. A fellowship will add to this, as you stated. Now say you are done training, I assume I must find a job as an attending at a qualifying hospital? Or else my 3-5 years of qualified payments aren’t worth the PSLF? How do I find a job as an attending that will continue to qualify me for my 10 year quota? Thank you so much!

    • Travis Hornsby July 2, 2019 at 4:31 PM

      Most fellowships lead to plenty of opportunities in 501c3 academic hospitals if you want one. Not too many specialties where that’s not the case

  21. KC July 28, 2019 at 10:20 PM

    Fantastic article and really appreciate your replies here. I am at the end of five years of residency+fellowship training and have thankfully have been making certified payments all five years under PAYE. Now that I am about to receive attending salary >$200K, what is the process now? Am I still able to recertify by PAYE payment plan with a much higher salary? You’ve mentioned the benefits of PAYE due to the cap in payment but how do I qualify during my recertification if there is no longer any “partial financial hardship”?

    Thanks Travis.

    • Ashley from Student Loan Planner August 5, 2019 at 10:52 AM

      Hi KC,
      Thanks for the great feedback! If you owe more than 1.5 times your attending salary and aren’t working for a PSLF-eligible employer, then it could be that paying off your loans aggressively would save you more money (possibly with refinancing). I’m not sure since I don’t have all the details. A consult would help you get to the bottom of this and make sure you have the best repayment strategy. Learn more about our consults here: https://www.studentloanplanner.com/help

  22. Amanda September 5, 2019 at 1:14 PM

    My husband has 9 different loans as he did not consolidate during residency or fellowship. He has 8 months left until he’s finished with training (he’s been at a PSLF qualifying institution since 12/2015). He has been in PAYE since 2018, he was in IBR before that; he has over $200k in student loan debt, but they all say “direct” in front of them. Am I correct in assuming there is no need to consolidate at this point? We looked online on FedLoans and they’ve only counted 3 payments!! Do we just need to call?? Thank you

    • Ashley from Student Loan Planner September 6, 2019 at 3:07 PM

      Hi Amanda,

      He doesn’t need to consolidate to be eligible for PSLF, since all the loans are Direct. In fact, consolidating would be detrimental because it would wipe away the months of credit toward PSLF that he already has.

      As for the payment count, make sure that the Employment Certification Form has been filled out for all these periods. If they had been, then you can contact FedLoan’s escalation team to review your payment count at (717)-720-7605 as a starting point.

  23. Vincent September 8, 2019 at 7:05 PM

    Hi. Thank you very much for your helpful article. I am currently a first year resident 3 months into grace period. So after reading through the comments, since I have all Direct loans (Direct Unsub Stafford, Direct Student plus, Direct Subsidized Stafford), I should NOT consolidate as it would wipe my credit? So then the only thing I need to do is:
    1. Fill out the annual PSLF Employment Certification form
    2. Choose PAYE (fiancee/wife will be making over 60k)

    Is this correct?

    • Travis Hornsby September 9, 2019 at 3:05 PM

      If you’re 3 mos into grace, you should consolidate bc you have 3 months to go and you only have 2 mos after consolidation through studentloans.gov. Also select fedloan for the servicer.

      • EW February 29, 2020 at 4:21 PM

        What is the benefit of consolidating loans that are all Direct Federal loans when they all qualify for PSLF already? Is it just to make sure you have FedLoan for the servicer instead of a private company?
        Thanks.

  24. Hanssen Tulia October 30, 2019 at 10:49 PM

    Shared! Shared! This is AWESOME stuff! Thank you!

  25. Stupid January 15, 2020 at 7:28 PM

    Hi, Travis,
    I am one of those physicians that made all of the mistakes in residency, and did not even realize it until a couple of years later.
    I started paying towards PSLF in my 3rd year of residency and paid in my 1 year of fellowship. Nobody in my family has any money, so I was hesitant to pay earlier in residency, in case I needed money.
    My loan when I consolidated was about 226,000 and it is the same now after 4 years of payment. I have paid about $65,000 already. What an idiot I am!!! I should have moved to a private lender and paid off aggressively immediately after I became an attending which was 3 years and 4 months ago. To add insult to injury, I took the deferment after residency.
    My starting attending salary was $200,000, now increased by 10% to $220,000. I worked overtime a lot last year and made almost $360,000 but this year I do not expect to have such opportunity.
    I have loans before 2007 and do not qualify for PAYE. Currently I am on REPAYE. I will ask Fedloans if possible to put me on IBR plan for the possible cap,
    I am a moron and at this time just trying to salvage the situation and not pay double what I borrowed.

    • Travis at Student Loan Planner January 27, 2020 at 3:49 PM

      Don’t feel back I’ve seen much worse actually. Are you eligible for PSLF? If so you need to be really careful on whether REPAYE or IBR is actually better. If you’re private sector then refinance right away https://www.studentloanplanner.com/refinance-student-loans

      If PSLF is on the table then I’d highly suggest getting a consult from us

  26. Seth January 26, 2020 at 9:14 PM

    Thanks so much for the great article. I am a first year resident, have consolidated with fed loans and am on REPAYE for the subsidy and am in the process of applying for PSLF. My girlfriend is also first year resident and has done the exact same thing. My big question is I started undergrad and received my first fed loan in aug 2006, does that disqualify all of my loans from PAYE after graduation? and If so should we wait to get married or can we just file separately once married to avoid the joint income for my REPAYE payments once we graduate residency, or is there a better IBR option. Im also not sure academics is where i want to end up so would privately refinancing negatively affect her as well? thanks!

    • Travis at Student Loan Planner January 27, 2020 at 2:57 PM

      REPAYE counts income proportionately it wont double count both of your incomes. Before refinancing you need to know if she can do PAYE filing separately so her plan doesnt get affected.

  27. Zach February 28, 2020 at 12:37 PM

    Hi Travis,

    I’m about to enter residency for orthopaedics. I’m considering repayment plans vs refinance. I imagine I’ll end up in private practice after my 6 years of training. Though, wouldn’t it still make sense to choose repaye in the meantime? With the interest subsidy I imagine I’ll have a “lower” interest rate than I would if I just refinanced now. Once I’m about to complete training and have an attending contract in hand, I would refinance again with a lower interest rate, and pay off the loans aggressively. If I do end up in academics, I’ll still be eligible for PSLF. Am I on the right track or am I missing something big?

    • Travis Hornsby March 13, 2020 at 9:02 PM

      Probably that’s the gist. There are more complications if you’re married during training that you’d need to consider. But if you’re single yeah REPAYE then refi once you’re an attending is reasonable.

  28. H May 28, 2020 at 6:45 PM

    Hi Travis,

    Always enjoy reading your articles! I’m currently on REPAYE anticipating 6 years of residency/fellowship with attending salary over 300k. If I switch to PAYE after fellowship for the cap, would I still be eligible for the 10 year PSLF?

    • Travis Hornsby June 3, 2020 at 11:22 AM

      Under today’s rules yes but can’t make any guarantees which is why we suggest ppl who know theyre doing PSLF choose PAYE

  29. Emma Kelley July 31, 2020 at 6:02 PM

    Can you switch from Repaye to IBR if you get into a high paying position (above $300000) 6-7 years down the line from the beginning of residency?

    • Amy at Student Loan Planner August 8, 2020 at 2:50 PM

      IBR requires you to demonstrate financial hardship, which can be hard to do if your income is too high.

  30. Zalak August 3, 2020 at 9:50 AM

    Hey Travis! thank you so much for your helpful articles they really help reduce the anxiety!

    Can this be done in retrospect? For example, currently 1 year out of residency, job hunting right now in NYC.
    I did my peds residency in a nonprofit 501c3 community hospital from 2016-2019 but haven’t submitted an ECF yet. Is it still possible those residency payments can count towards the 120 payments if i submit the form now?

    Thank you in advance!

    • Amy at Student Loan Planner August 8, 2020 at 2:56 PM

      You would have had to have been enrolled in a qualifying repayment plan at the time and your employer would have to be willing to submit the certification form.

  31. Sarah Pursley October 5, 2020 at 10:07 AM

    My credit score in residency was never higher than 600 so I thought I wasn’t eligible to refinance anything? I have signed up every year for the PSLF forms during residency and I have 500k in med school only debt. I am now an attending at a non-profit hospital and have a salary of 365k. My credit score is slowly slowly going up finally at 630 last i saw it. Should I still refinance the tons of students loans that I have? I was just updating the PSLF paperwork for the job I just started after residency. I’m afraid I missed the boat with the refinancing thing….
    Appreciate all your great advice.

    • Amy at Student Loan Planner October 7, 2020 at 4:43 PM

      It’s hard to tell without looking at your situation in-depth. Generally, you should only refinance if your student loan balance is LESS than your income. If you qualify for PSLF, that’s almost always a better deal than refinancing. I suggest taking a look at our consultation service to go over your options so you understand the best path forward.

  32. Emily February 4, 2021 at 2:21 PM

    How does the current loan deferment situation impact PSLF? We started making payments in August because we graduated in May 2020. I’ve heard of some people that have zero dollar payments right now. We opted to start paying ours because we were worried that the deferment period wouldn’t count towards our 120 payments. Now that it has been extended again, we are wondering if we should get on the zero dollar payment bandwagon.

  33. Guest April 21, 2021 at 1:41 AM

    All of my stafford loans and grad plus loans already say “Direct” in the name. Stafford unsubsidized and grad plus loans. Do I still need to consolidate to one direct loan to go for PSLF? Doesn’t consolidating capitalize my interest into the principal?

    • Amy at Student Loan Planner April 26, 2021 at 9:23 AM

      Consolidation isn’t always a requirement to qualify for PSLF. It’s a strategic move that makes sense in some situations. It’s not right for everyone.

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