LRAP/IBR/PSLF. How does it work? Let's find out!

[presh]

Thoughts on adding a section about how a spouse’s income will affect LRAP/IBR options?

I’m guessing this might vary by school; but it might be useful info to consider, especially for those whose SOs have high paying jobs.

[twenty]

Okay, but I need help fact checking. My general information on spousal income is 3-4 years old. If someone else wants to write something as well, I'll link to it in the OP.

[Rink]

Does being an elected county DA qualify for PSLF? All I can find is the usual "Government organizations at any level (federal, state, local, or tribal)" with the caveat that being an elected member of Congress does not qualify.

Asking for my boss, who thinks he doesn't qualify but who does not make a lot of money out here in Rural America. (The state pays a base rate to all elected DAs, and most counties chip in above that. This county does not.)

[Nebby]

They qualify

[urmlaw18]

Couldn't you just go into big law for 3 years, pay under IDR and enjoy the rest of leftover, and then go into public interest job and never make a loan payment?

[Nony]

What does “pay under IDR and enjoy the rest of the leftover” mean? Do you mean while you’re in biglaw, pay ahead the full amount of what you’d owe on an income-based plan that gets forgiven at the end of 10 years of public service? (That is, pay ahead so you essentially have a balance that the future payments pay down?) I’m sure you could, although you probably won’t know what your income will be under the public interest job to do the math, and you may not be able to guarantee the timeline. You’d probably be better off saving/investing the money while in biglaw and using it to make payments later (you’d have access to it in an emergency).

[presh]

I think they were saying do IBR while in biglaw while saving/investing, and then go into public interest after building up a cushion. But having no payment in public interest is unrealistic unless you’re making under 40k.

[Rink]

I think they were saying do IBR while in biglaw while saving/investing, and then go into public interest after building up a cushion. But having no payment in public interest is unrealistic unless you’re making under 40k.

Yeah I make like $54k and my payment is low (under $300) but it certainly exists.

[Nony]

I thought they meant “no payment” in the sense that if you pay a lump sum at once they don’t apply it all at once unless you direct them to - they only take out your monthly payment, then the next month they take out the next payment, and so on - so you can basically maintain a balance and they’ll draw from that. But it seems impractical to try to do that, which may be why I’m confused/misunderstanding (because I agree, you’re going to have a payment working PI unless you’re really making even closer to nothing).

[Rink]

I thought they meant “no payment” in the sense that if you pay a lump sum at once they don’t apply it all at once unless you direct them to - they only take out your monthly payment, then the next month they take out the next payment, and so on - so you can basically maintain a balance and they’ll draw from that.

They don't do that for me. If I pay over my minimum payment, I can direct which loans get the extra, but it gets applied right away. (My school gives me more in LRAP than my PAYE payment.)

[Nony]

Weird. They do that for me - I got some loan assistance from the feds and haven’t had to pay anything for a bunch of months, it’s been applied to each month’s payment as it comes up.

[Guest]

I’m currently on REPAYE and I am not elpigible for PAYE. My soon-to-be spouse makes $75k and I make $120k. He has no loans but I have $200k+. I’m working for the federal government and have 8 years left for PSLF. Looking at calculators, it seems I have two options to keep my payments down: (1) don’t get married and keep the benefit of 10% payments on REPAYE; or (2) switch to IBR after getting married and file separately so I only pay 15%. With REPAYE’s marriage penalty I don’t see another option. Am I missing something here?

[twenty]

I’m currently on REPAYE and I am not elpigible for PAYE. My soon-to-be spouse makes $75k and I make $120k. He has no loans but I have $200k+. I’m working for the federal government and have 8 years left for PSLF. Looking at calculators, it seems I have two options to keep my payments down: (1) don’t get married and keep the benefit of 10% payments on REPAYE; or (2) switch to IBR after getting married and file separately so I only pay 15%. With REPAYE’s marriage penalty I don’t see another option. Am I missing something here?

I'm assuming you do not qualify for either PAYE or new-IBR? If so, you're stuck between either the marriage penalty or the 15% income hit on old IBR. :/

[Guest]

I’m currently on REPAYE and I am not elpigible for PAYE. My soon-to-be spouse makes $75k and I make $120k. He has no loans but I have $200k+. I’m working for the federal government and have 8 years left for PSLF. Looking at calculators, it seems I have two options to keep my payments down: (1) don’t get married and keep the benefit of 10% payments on REPAYE; or (2) switch to IBR after getting married and file separately so I only pay 15%. With REPAYE’s marriage penalty I don’t see another option. Am I missing something here?

I'm assuming you do not qualify for either PAYE or new-IBR? If so, you're stuck between either the marriage penalty or the 15% income hit on old IBR. :/

I guess my other option is to put off legal marriage for another 8 years. It’d would save me about $3,000-3,300/yr... pretty lame.

[Borhas]

fun fact: If you are applying for an FHA backed loan, HUD requires lenders to assume that you are making 1% payments every month, so if you owe 100k the lender has to pretend you are paying 1k in student loans every month even if you are in IBR and paying $50/month.

[Rink]

It's been over 90 days since I requested the review of my qualifying payments so I called FedLoan to check in. The review isn't done yet because of high volume, okay.
I mentioned that my issues are from payment dates getting advanced because I paid more than the minimum payment (because I have to spend my LRAP money). The girl says "oh, we don't want you to pay more than your minimum payment. Payments over the minimum aren't qualifying payments."
After making payments for 2 full years, one loan has 13 qualifying payments. One loan has 10. Six loans have zero qualifying payments.

You gotta love a system that punishes for paying extra. I really hope they sort that shit out because I can't be the only one in this situation. Seems like paying extra is something that should be encouraged, not the opposite.

[Borhas]

That's psychotically stupid

[Rink]

But wait! There's more!

Back in April, FedLoan offered me a 0.1% reduction in interest rate on all loans for setting up autopay. It worked fine. Each month I got an email saying that my payment would process in 5 days or whatever and then an email saying that it did process.

On 8/5 I got the reminder that my payment would process on 8/12 (the due date), as usual. On 8/13 I logged in to check something else and it says my payment is late. Not only that, autopay is no longer set up. I don't know if my rate changed back.

What the fuck, FedLoan?

[Nebby]

It's been over 90 days since I requested the review of my qualifying payments so I called FedLoan to check in. The review isn't done yet because of high volume, okay.
I mentioned that my issues are from payment dates getting advanced because I paid more than the minimum payment (because I have to spend my LRAP money). The girl says "oh, we don't want you to pay more than your minimum payment. Payments over the minimum aren't qualifying payments."
After making payments for 2 full years, one loan has 13 qualifying payments. One loan has 10. Six loans have zero qualifying payments.

You gotta love a system that punishes for paying extra. I really hope they sort that shit out because I can't be the only one in this situation. Seems like paying extra is something that should be encouraged, not the opposite.

I pay over the minimum every month (LRAP benefit is more than the minimum) and all my loans show the same and correct number of payments. Maybe she just meant that, say you pay one in a month w/ the minimum, and then within that same month you pay a month's more, then that second payment doesn't qualify.

Also, I recommend the electronic option for submitting your form. It was about a 3 to 4 week turnaround the last two times I did it. I recertify every 10ish months just to keep an up to date accounting to catch problems early.

[Kümmel]

nebby what’s your servicer

[Nony]

I thought FedLoan was the only servicer for PSLF people.

[Rink]

What electronic submission method?

Your theory on a 2nd payment doesn't apply because plenty of months I made one payment of more than my minimum. I divided it as the minimum due on every loan plus the rest on the highest-interest loan. And 6 of my 8 loans show zero qualifying payments.

[Slytherpuff]

nebby what’s your servicer

I know Nebby has FedLoan as well (and I was under the impression that it was the only PSLF servicer too).

[Nebby]

What electronic submission method?

Submitting it through FedLoan's website

[Rink]

What electronic submission method?

Submitting it through FedLoan's website

I haven't noticed an electronic submission method. But them receiving the employment certification hasn't been my problem, it's that they're only counting each of my payments as "qualifying" on one of 8 loans. (And all of my loans are definitely eligible).