Well, it was fun while it lasted, but it’s finally over. In case you missed the news, back in June, the United States Supreme Court ruled against student loan forgiveness and ended the student loan forbearance for federal loans. This means that starting Fall 2023, payments are set to resume, and your loans will also start to accrue interest. Whether you’re ready or not, those emails and mailers are bound to come in reminding you to update your accounts and start preparing for payments again.
Take a breath. That’s a lot of big changes to unpack in just one paragraph. We get it. Vet school, a new career, or the day-to-day as a veterinarian is already enough for you to handle. The good news is we’re here to help you out and provide some support as you start to prepare for those payments. In the past, we shared some tips to pay off vet school debt. However, we didn’t provide you any repayment options and resources, and there’s been quite a few changes to loan providers and repayment options since then. So, here are a few options and resources you might want to consider once payments start.
Standard Repayment Plan
No need to go too in-depth with this one. This is the payment plan you’ll be on if you don’t opt for any of the repayment plans mentioned below. If you feel comfortable paying back your student loans on a month-to-month basis without altering or stretching your budget to do so, this is the payment plan we would recommend for you. Minimize interest and finish paying off your loans in 10 years.
Graduated Repayment Plan
This one is for the students and early-career veterinarians. At this point in your veterinary journey, you probably don’t have the income right now that you’re planning on having later down the road, so making large payments towards student loan debt straight out of school might not make a whole lot of sense. That’s where a graduated repayment plan can help. With this plan, you can decrease your payments at the beginning of repayment, and incrementally pay more every two years. This plan is great for helping you pay for other things early in your career, but be sure to plan accordingly, as payments can get pretty high as they incrementally increase.
Income-Driven Repayment Plans (IDR)
If you’ve been paying attention to the student loan forgiveness news, you may have heard the acronym IDR being tossed around. Income-Driven Repayment Plans (or IDR) is a repayment plan that helps make your monthly payments more manageable based on your income. Your loan provider will essentially calculate the payment amount that is best for your circumstances based on your discretionary income available each month. If you feel that your undergraduate loans combined with your vet school loans are going to be a bit too much to handle early in your career, this may be a good option to consider.
Loan Consolidation and/or Refinancing
If you have a lot of different federal loans from different lenders with varying interest rates, you might want to consider consolidating them to help simplify the entire process for you. While it won’t necessarily lower your interest, the goal of consolidation is to help you save money and/or lower your payments. Consolidating also gives you the flexibility to extend your payment period to help you lower monthly payments.
Ever heard the phrase, “Date the rate?” This can also apply to your student loans as well. If there is a private loan provider that has an interest rate you believe can save you some money in the long term, it might be time to consider refinancing your private or federal loans. Keep in mind that once you refinance a federal loan, it no longer qualifies for any federal repayment programs and options that could be available to you. If you’re trying to figure out if the savings are worth it, check out this Student Loan Refinance Calculator to see how much refinancing could save you.
Veterinary Medicine Loan Repayment Program (VMLRP)
This one isn’t for everyone but is definitely worth looking into. Veterinary Medicine Loan Repayment Program (VMLRP) is a program that pays up to $25,000 per year towards qualified student loans. The catch here is that you have to agree to work in areas designated by the government as having veterinary shortages for a minimum of three years.
Public Service Loan Forgiveness (PSLF)
If you’re a veterinarian working in public health, public service, or for a private non-profit, this is definitely something to look into. Public Service Loan Forgiveness (PSLF) is a program that forgives the debt remaining on eligible loans for borrowers who have worked at least 10 years in the public service or non-profit sector. This can be a pretty impactful program for those of you who are considering or have been working those spaces and qualify.
Ok, take another deep breath. That’s a pretty good handful of options to consider. For that reason, it’s all the more important to have conversations with your loan providers, as well as others you trust, to figure out which options are best for you and your circumstances.
Now, while we may not be experts on this topic, we are bringing you someone who is that can help you if you’re looking for advice. If you’re navigating interest, payments, and changes to your student loans, join us and the VIN Foundation for our Student Loan Webinar! Join Tony Bartels, DVM, MBA (a leading authority on U.S. veterinary student debt) for a review of the current and future changes you need to know, and bring your questions for a live Q&A afterwards. Make sure to RSVP and Climb Mt. Debt with us on Thursday, October 12!
P.S. If learning how to navigate your student loans isn’t convincing enough, this webinar is also RACE approved and counts for CE credits! Visit the event page to learn more today.