Listen in with student debt experts and Board Member Drs. Tony Bartels and Rebecca Mears in this next installment of our Student Debt Series. In this episode we’re covering the latest news on the student loans as it relates to the outcome of the recent presidential election.
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NOTE: This is an ongoing situation, for continued updates visit the VIN Foundation Blog and student debt message board areas.
GUEST BIOS:
Dr. Tony Bartels
Tony Bartels, DVM, MBA graduated in 2012 from the Colorado State University combined MBA/DVM program and is a VIN Foundation Board Member and Student Debt Expert, and an employee of the Veterinary Information Network (VIN). He and his wife, a small-animal internal medicine specialist practicing in Denver, have more than $400,000 in veterinary-school debt that they manage using federal income-driven repayment plans. By necessity (and now obsession), his professional activities include researching and speaking on veterinary-student debt, providing guidance to colleagues on loan-repayment strategies and contributing to VIN Foundation resources. Beyond debt, his professional interests include small- and exotic-animal practice. When he’s not staring holes into his colleagues’ student-loan data, Tony enjoys fly fishing, ice hockey, camping and exploring Colorado with his wife, Audra, daughter, Lucy, and their two rescued canines, Addi and Maggie.
Dr. Rebecca Mears
Rebecca Mears, DVM is from Lexington, KY, and a graduate of University of Georgia’s College of Veterinary Medicine. Rebecca started her career as an equine general practitioner and is an active AAEP member, currently serving as a member of the AAEP DEI Committee. Her interest in student debt education began with keeping her own education costs lower and grew from there. This was supported by her involvement in the Veterinary Business Management Association (VBMA), which she now gives back to as a National Advisor. In her time away from veterinary medicine, she can be found obsessing over plants and hosting impromptu dance parties. She is passionate about giving back to the profession and improving the lives of veterinarians, pre-vet and vet students.
LINKS AND INFORMATION:
VIN Foundation Student Debt Center
It’s time for a good student loan “physical exam” using the VIN Foundation My Student Loans tool
VIN Foundation Student Loan Repayment Simulator
VIN Foundation GIVE page to support these programs & tools
VIN Foundation Blog, Related Student Debt Blog posts:
- Veterinary Students Borrowing:
Personalized student loan help from VIN and VIN Foundation
Federal Student Aid Data, Consolidation, and Repayment Applications
Department of Education Updates on Saving on a Valuable Education (SAVE Plan)
SAVE Plan Court Actions: Impact on Borrowers
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TRANSCRIPT:
Intro
Tony Bartels, DVM, MBA: One of the other things we’ve been waiting for are the one time forgiveness count adjustment updates and that hasn’t been publicly released anywhere, but there is a way for you to check your forgiveness payment count adjustment.
Meet the Host and Guests
Jordan Benshea: That is student debt expert and VIN Foundation Board Member Dr. Tony Bartels with Dr. Rebecca Mears, and this is the VIN Foundation’s Veterinary Pulse Podcast Special Student Debt Series. I’m Jordan Benshea, Executive Director of the VIN Foundation. Join me as I talk with veterinary colleagues about critical topics and share stories, stories that connect us as humans, as animals, as a veterinary community. This podcast is made possible by individuals like you who donate to the VIN Foundation. Thank you. Please check the episode notes for bios, links, and information mentioned. Welcome to our listeners. We are once again back with our VIN Foundation student education experts, Doctors Tony Bartels and Rebecca Mears. We are here for a student debt series episode, and we are here to talk about the latest student loan news based on the election that was now 2 days ago. Welcome Tony and Becca.
Tony Bartels, DVM, MBA: Hello.
Rebecca Mears, DVM: Thanks, Jordan.
Impact of Recent Election on Student Loans
Jordan Benshea: Well, with the long expected election that happened on Tuesday, we know one thing for sure, and that is that there will be upcoming changes to student loans. Let’s dive right in on what this means for our listeners and for student loan borrowers. Tony, can you take us through what we know now about the impact of the election on student loans?
Tony Bartels, DVM, MBA: Yeah, well we can try anyway. So…
Jordan Benshea: Fair enough. Fair enough.
Changes in Student Loan Repayment Plans
Tony Bartels, DVM, MBA: I mean there were a lot of changes that were coming regardless of what happened on Tuesday. So, I mean currently SAVE, the Saving On A Valuable Education plan, which was formerly known as Revised Pay As You Earn was blocked by a federal appellate court this past summer. So anybody who had been using that particular plan has been in a general forbearance since July, and we learned last week that the Department of Education expected that forbearance to last for at least another 6 months.
Jordan Benshea: Okay.
Tony Bartels, DVM, MBA: But that might be complicated by the election results. So we’re going to have a change in administrations, which means that the current executive branch, the folks that are part of the Department of Education and making all these decisions and changes behind the scenes on student loan repayment are on the way out and the next administration is going to come in. And they couldn’t be more different in their vision for what they would like to see happen with student loans. So, chances are we’re going to see something change, and that’s before we learn or maybe after, depending on the timing, the outcome of the litigation that has SAVE all tied up, as well as potentially, the forgiveness plans that were created in the same way that SAVE was created. That includes ICR, which is the income contingent repayment plan, the original income driven option that was created way back in 1994. Pay As You Earn, Revised Pay As You Earn, and SAVE all were kind of created using the same authority at the time. And that’s been questioned by this recent court case. So it really depends on how the court comes down and how expansive the ruling is in terms of which options are remaining from a forgiveness standpoint. It is, I would say, it’s quite likely because the original litigation pertained to SAVE and the court who blocked SAVE kind of went on to make some statements about, “well, maybe this whole forgiveness thing, the way it was created when ICR was created, wasn’t done quite right”. If they go that far, then we’re going to lose a lot of the income driven plans. We still will have the income based repayment plan. So there’s two versions of those. Those were created in a different manner and were much more explicit about what should happen with loans, including forgiveness. So there’s always something to fall back on, but those newer plans, the ones that were all created around in the same manner as ICR, Pay As You Earn, Pay As You Earn, or SAVE. Those tend to be the more beneficial of the income driven repayment option. So we may see some or all of those go away or some, who knows, some weird version in between. But it’s likely that SAVE is going to be gone. I think that with the change in administrations, I mean, this administration has been the creator and defender of SAVE since they’re on the way out, the new administration certainly doesn’t have a vested interest in defending SAVE. So, quite likely that if the court does say, ” this went too far”, that it’s going to be gone. But that has also created quite a cloud in terms of being able to apply for plans or to provide updated income information if you have an income recertification that’s due for an existing plan. So the whole system has really, the whole student loan repayment system has kind of ground to a halt. So it’s been very difficult for anybody to switch plans, apply for a plan, do their income driven repayment certification, and that has had profound effects for those people who were trying to get into SAVE when it was first released in October of 2023. Then most recently the 2024 graduating class who are approaching the end of their grace periods and are trying to decide on repayment plans, they’re kind of met head on with all of this uncertainty and difficulty in trying to get their loans and any of the available income driven repayment plans.
Jordan Benshea: Okay, so a lot of things that we don’t know.
Tony Bartels, DVM, MBA: Correct. This is the definition of uncertainty.
Jordan Benshea: Right, right.
Tony Bartels, DVM, MBA: And it drives people crazy, when they, if you follow any kind of economic news. Actually the election is a perfect example. The markets hate uncertainty and since we actually had an election where we know the winner relatively quickly and we know pretty much what their stance is on stuff, the markets were ecstatic to have some certainty. And we saw the markets go bonkers yesterday and largely today. So when uncertainty clears you may not like what might be coming next, but at least we kind of have an idea of what’s coming next. The same is not true with student loans. Right now, we’re still swirled in uncertainty and there’s going to be a lot of anxiety around that until we know exactly what the repayment landscape looks like. And we’re likely to know that for, for quite some time here yet.
Interest Rate Changes and Their Impact
Jordan Benshea: Another thing that I’ve heard coming down the pipeline sooner rather than later is a change in our interest rates. What sort of impact does that have for our colleagues with student loans?
Tony Bartels, DVM, MBA: Yeah, so there, the interest rates, there was a big interest rate cut about a month ago now where the fed cut interest rates by 50 basis points, which is essentially a half a percentage point. They are meeting again this week, I believe to potentially decide on another rate cut. Now, those rate cuts have to do with very short term rates, the rates that banks use to charge each other when they’re lending money. Generally speaking, the trend of those rates should trickle down into some lower interest rates for things that are impacted by those sorts of things like student loan interest rates. But we haven’t seen that yet. So that’ll be some time before we see that trickle down. And in fact actually with the fed cutting the short term interest rates we’ve actually seen the yield on the 10 year Treasury and some of the longer ones actually go up. And that’s really what affects some of those interest rates on longer term things like mortgages and student loan interest rates when they’re set. So, we have to wait a little bit longer to see kind of what that macro impact will be on some of those longer term interest rates.
Jordan Benshea: Because I can imagine that veterinary students are thinking how will that impact me, right?
Tony Bartels, DVM, MBA: Yeah, well it will have an impact on them. The interest rates that veterinary students are paying right now on the loans that they took for the 2024 2025 academic year are the highest that we’ve seen in decades. Right now it’s quite likely that the interest rates on the loans that they take next year, so for the 2025 2026 academic year will be lower, although they may not be much lower. It depends on where and that 10 year Treasury yield lands next May, June-ish and what that long term trajectory for interest rates looks like. They should be lower than the rates that they’re paying now, but again, it may not be much. But anything will be a relief compared to those rates that they’re on their student loans for this particular academic year.
Navigating the Student Loan System
Jordan Benshea: What other sort of changes should colleagues be on the lookout for right now?
Tony Bartels, DVM, MBA: Well, you have to be, like I said before, the administration of the system itself is a mess. So…
Rebecca Mears, DVM: you can say that again.
Tony Bartels, DVM, MBA: Any interaction that you have to have with either studentaid.gov because you’re applying for an income driven plan or you’re maybe consolidating your loans or you want to recertify your income for an upcoming income recertification or maybe your income has decreased and you’re trying to have your payment recalculated lower, several deep breaths. Lots of patience. Take lots of screenshots of everything that you’re doing. Make sure that you print out any application right before, right after you submit it, so you know exactly what you submitted and when you submitted it. You may even need to do a application via PDF or even snail mail, depending on how things are going. It’s just been highly variable in terms of what we’re seeing happen when you submit an application. So sometimes those go through well and a lot of times they don’t. Some of the other things that we’re seeing are because SAVE is blocked, if you choose SAVE as your repayment option you’re not really going to get Into SAVE. Oftentimes your loans might be in a standard plan first, so you have to kind of look to see in your loan servicer account or look for a statement from your loan servicer that says what repayment plan you’re in. It may be a pretty big scary number and says it’s due next month. That’s when you’re going to need to call them and say, “hey look, I thought I applied for SAVE”, and request a forbearance while they work your loans through that system, and eventually get your loans into this general forbearance where no interest accrues and no payment is due, but no forgiveness credit is earned either. But that’s the best place you can get your loans currently if you’re going to use an income driven repayment plan is, apply for SAVE, try to get them into this general forbearance. Then, stay tuned for what the end of that looks like, when it’s going to end, and, what to do next.
Jordan Benshea: Another thing is probably important to make sure that they have their contact information updated, right? If there’s any information going back and forth, however, they’re submitting information just making sure that that’s correct and current.
Tony Bartels, DVM, MBA: Yeah, sure. That’s always a great habit to do. I mean, you could do that on studentaid.gov. You’ll want to do that to your loan servicer account as well. But yeah, you’re going to have to follow this stuff even more closely than we recommend that you followed it previously because it has been such a mess.
Jordan Benshea: Right.
Resources and Support for Borrowers
Jordan Benshea: Where can colleagues go for updates on the latest info?
Tony Bartels, DVM, MBA: Studentaid.gov, ed.gov. So the Department of Education.gov has a good page. We will include that here in the podcast notes, but there’s a good page that they’ve been updating relatively frequently on where things stand with SAVE. And if you’re trying to do certain things or check on Public Service Loan Forgiveness credit or any of the other questions that you might have on student loans. That’s a good place to start. VINFoundation.org, the blog we’ve been trying to keep up to date with those. We’ll try to crank out another update here that aligns with what we’re talking about on the podcast and what to expect next. Maybe include some of the common questions and concerns that people have been posting on the Student Debt Message Board area regarding their experience with student loan repayment right now.
Jordan Benshea: Yeah, that’s probably a great opportunity to just reiterate that the Student Debt Message Board area is really a great resource because as uncertain and unsure as any of our colleagues and listeners might be feeling right now, you’re not alone in feeling that way. And there are definitely others who feel that way. So there is a lot of opportunity to find your community there, and to hear other people’s thoughts and feelings and ideas on what’s going on. And just, if nothing else, to kind of share your questions and to hear what other people say, because you’re definitely not alone in that feeling of uncertainty as it relates to student loans and the upcoming changes. So really encourage everybody the Student Debt Message Boards. It’s all free. It’s all available. You do not need a VIN membership, you can get access through a special VIN Foundation membership, which is always available and here to help.
Final Thoughts
Jordan Benshea: Is there anything else you think our listeners need to know about this news or anything else about student loans?
Tony Bartels, DVM, MBA: I would also, one of the other things we’ve been waiting for are the one time forgiveness count adjustment updates. That hasn’t been publicly released anywhere, but there is a way for you to check your forgiveness payment count adjustment. It’s a little hacky. It’s a little weird. It’s going to look really funny. But there is an API available that will show you what the Department of Education currently has in their database for your qualifying number of forgiveness payments. We’ll put also the steps that you need to follow to access that information In the podcast notes here, too. It’s a little bit difficult to spell out verbally, but if you would like some assistance understanding that or looking and making sense of that payment count adjustment data. We’ve had a lot of VINners and veterinarians recently posting that information on the Student Debt Message Board area, and Becca and I can look through that and give you an idea of what it’s telling you.
Outro
Jordan Benshea: Yeah, I really encourage you to take advantage of the resources with our student debt education team. We’re really here to help. Thank you guys for being here and being willing to answer questions and give information. We will keep coming back and doing these podcasts and blog posts as relevant and helpful as they can be. And keeping all of you updated on the latest information. Thanks you guys. Thanks for being here.
Tony Bartels, DVM, MBA: Thank you, Jordan.
Rebecca Mears, DVM: Thanks, Jordan. Thanks, Tony, so much for sharing all of that information.
Jordan Benshea: Thank you for joining us for this episode of the Veterinary Pulse. Please check the episode notes for additional information referenced in the podcast. If you enjoyed this podcast, please follow, subscribe, and share a review. We welcome feedback and hope you will tune in again. You can find out more about the VIN Foundation through our website, VINFoundation.org, and our social media channels. Thank you for being here. Be well.
