PracticeLink Magazine

Winter 2018

The career development quarterly for physicians of all specialties, PracticeLink Magazine provides readers with feature articles, compensation stats, helpful job search tips—as well as recruitment ads from organizations across the U.S.

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Page 43 of 91

44 W INTER 2018 features Pay As You Earn (PAYE) Pay As You Earn (PAY e ) usually offers the lowest monthly payment, which is set at 10 percent of your discretionary income. According to the Federal Student Aid website, "your spouse's income or loan debt will be considered [for PAY e ] only if you file a joint tax return." After 20 years of making qualified payments, any remaining debt is forgiven. Federal Student Aid reports that, to be eligible for PAY e , you must be a new federal borrower on or after October 1, 2007, have received a Direct Loan disbursement on or after October 1, 2011, and demonstrate financial hardship. Income ‑ Based Repayment I B R determines you r monthly payment based on your discretionary income. For borrowers on or after July 1, 2014, payments are based on 10 percent of your discretionary income, with a repayment term of 20 years. Those who borrowed prior to this date are capped at 15 percent for a 25-year repayment term. You must demonstrate financial hardship to qualify. (Most residents and fellows will meet this requirement.) Stafford Loans, P lu S Loans and Federal Consolidation Loans are eligible. Loans refinanced with private lenders aren't eligible for IBR. Revised Pay As You Earn (REPAYE) The most recent option, created in 2015, is the Revised Pay As You Earn (R e PAY e ) plan. Borrowers who have a Direct Loan and financial hardship may qualify, regardless of the loan origination date. R e PAY e calculates monthly payments no higher than 10 percent of your discretionary income. Payment is calculated over either 20 or 25 years, depending on if the loans were for undergraduate study or graduate/ professional study. "T he most attractive benefit of R e PAY e is that only half of outstanding interest is charged d u r i n g p e r io d s of n e g a t ive amortization," DiLorenzo says. With all income-driven payment p l a n s , y o u n e e d to s u p p l y documentation to verify your income and profile, and resubmit this each year, even if your financial situation hasn't changed. Failure to do so risks losing your plan and being converted back to a standard plan. If you qualify for PS l F, payments made under these income-driven pay ment pla ns a re presently considered qualifying payments. Balance forgiveness Another benefit of the income- driven plans is balance forgiveness. At the end of your payback period of either 20 or 25 years (depending on your plan), any remaining debt is forgiven. While that is enticing, it's not completely without warning, says James M. Dahle, M.D., founder and p Resident Erica Marden, M.D., chose a repayment plan that maintained her eligibility for PS l F. · Photo by Jaclyn Schmitz See this issue's physicians in exclusive video interviews at

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