The above IBR payment calculator is from Edfinancial and if I enter $90,000 AGI, 2 household size (you and spouse, since he makes more I didn’t count children because it says receive more than 50% of support from you), $130,000 for balance at beginning of repayment and $127,000 balance currently, 8% interest rate. Paymeny is $841.
If I put household size to just 1 (not sure if spouse can count if filing separate) then the payment is $915
You can try the calculator yourself because I don’t know the interest rate. But it seems you are paying much more.
Contact your loan servicer. I think you need better and more accurate information on exactly where these pay,ends are going (interest vs. principal). What you are posting here doesn’t make sense.
@kelsmom@BelknapPoint is this true? You have to file separately to do income based repayment on college loans?
I think it would benefit your family to look into this. Contact the loan servicer about payment amount and all your repayment options, and then contact a tax professional.
If she files MFJ then the AGI of both count. And then family size can be 4. Payment will possibly be higher than now depending on interest rates.
But if she has been paying $1300 a month so far, it might still be beneficial if it allows her to claim a student loan interest deduction for the current and past three tax years, and the AOTC for 4 years when D is in college.
If the interest rates were different, can she consolidate the loans into one loan?
It would be nice to either have lower student loan payments while D and then your S is in college, or to pay current amount (or slightly more) and be able to take advantage of AOTC and student loan interest deduction.
I am having a very hard time understanding how you have a $1,300 payment under any income driven repayment plan with $90,000 income & spouse income not being taken into consideration. The only plan with a payment that comes close is ICR, and that payment includes spouse income even if you file separately.
And no, it is not required that OP file separately for an income driven plan. In fact, taking H’s income into consideration … assuming the $147,000 combined figure I saw posted upstream … an IDR plan with married filing jointly & both incomes would yield anywhere from around $550 to a bit over $1,000 per month, depending on what plan(s) the OP’s loan qualify for.
Oh, I just realized that I left the calculator as “married filing separately.” With both incomes and assuming an AGI of $147k, the repayment would be anywhere from around $975 to $1,500. With REPAYE, which started last year, the repayment amount should be less by several hundred dollars a month … AND you could file jointly to get those tax benefits. OP, you need to contact your loan servicer(s) to discuss your options. (Note: There is no cap on the REPAYE amount, which could rise to more than the standard 10-year repayment amount if you were to earn tons more in the future - but if you earn more, you are in a position to pay more, so there’s that.)
The OP should have consolidated the loans at tge outset. I had slightly less in loans, consolidated them at 2% interest, and pay less than $300 a month. I know some are debt averse, but I’m not. And at 2% interest, the government, not me loses, given inflation. And I’ve used my income to invest at a significantly higher return than 2%.
Water under the bridge, however. Seems like they will get forgiven soon, anyway.
The interest rate on a federal loan consolidation is a weighted average of the loans’ interest rates. I am not sure how one could get a 2% interest rate on any loans borrowed any time in the recent past.
Hey everyone thank you so much for the replies! I plan to contact Ed Financial tomorrow with some of the things you are mentioning here.
My interest rate is 6.75! None of the loans are subsidized. That was the rate at the time the loans were consolidated. I graduated from law school in 2007.
All I know is that if my husband and I file our taxes together, I do not qualify for any IBR plan. I am not eligible for some of the other plans because they went into effect after my loans were in repayment or something like that.
@thumper that is my gross income I am a GS 13 -3 with a locality of St. Louis
You should qualify for REPAYE with a rate that is lower than your current rate. No partial financial hardship is needed. You may also qualify for “new” IBR, which was not available to you in 2007. Go to www.studentloans.gov. Sign in with your FSA ID (the same one you used to sign your kid’s FAFSA). Find the repayment calculator - it will pull up your loans. Enter what your AGI would be combined, and see what it says for repayment options and amounts for you.
Ok so its taking me a while to get back to this thread but i am currently in the process of seeing if I can switch to another one of the IBR programs- I submitted all of my paperwork and had to do the IRS link for my tax and my husbands tax (even though we file separate to qualify for this reduction) and it looks like my loan amount might be reduced under REPAYE. I don’t qualify for the “new IBR” program. If it gets approved, it will be in the $540 range
after ten years of repayments i can apply for forgiveness… my loans were deferred for the first few years after i graduated from law school. I work in the public sector and once I have made ten years of payments while working as a federal employee, I can apply for forgiveness of the balance.
