House bill would end PSLF, current to be grandfathered

[The White Coat Investor]

FutureDoc wrote:

Really surprised that no one else has really commented on the 150k cap for graduate degree loans.  Lots of students are in more debt than that.

Also, nobody can predict the future, but I put a pretty good wager that if the house bill gets through and ends PSLF we are going to see some major shifts in new graduates coming out in 7 years.

 

 

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That's for federal loans. There's a cap on those now. You can only get so much a year. Above that, it's private. Usually at 7.9%. Could be worse. If you're in the Caribbean, your loans are likely at 8-10% and your match rate is 57%.

[Wings3496]

Literally the only mention of PSLF is on page 84 of the PDF:

"With respect to the public service loan forgiveness program under section 455(m)"

And this is in regards to the US ed sec being required to publish data on the program and how much debt is being forgiven. Given the size if this bill it is frustratingly vague in regards to forgiveness programs other than specifically for teachers. So if the intention is "well if a program isn't in this bill, it will no longer exist" - well okay then, but otherwise it seems difficult to know the future of PSLF, and even of potential 'grandfathering'.

[jsr52]

I have to imagine grandfathering will only apply to PSLF and not specific payment plans, so for those cruising along in IBR or Repaye at 10% of income I imagine they would be combined into whatever the new income based payment would be, looks like 15%. Big question is will the new payment plans incorporate spouses income...

[Sergio Estavillo]

Grandfathering, for PSLF and IDR plans, apply to Direct Loans. This legislation proposes the Federal One Loan Program collapsing the current Unsub and Grad PLUS. The Federal One Loan will have an aggregate limit of $235,500 and annual of $55k for certain health professions. Direct will sunset on June 30, 2024 under this legislation.

[The White Coat Investor]

jsr52 wrote:

Remember, PSLF was created for Public Defenders and Public Educators. Folks who have large student loans with low lifetime future income. Physicians got looped into this because of essentially a gross miscalculation. PSLF is not for people who will essentially be rich, so the clock truly is ticking for physicians to get grandfathered in.

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Not sure a pediatrician with $600K in student loans should be considered "essentially rich."

[jsr52]

Fair enough