With lower or no income, you can submit to have your minimum monthly student loan payment recalculated — all the way to zero if you currently have no taxable income. The benefit of doing so is three-fold:
- Reduce your monthly student loan payment;
- Receive credit towards student loan forgiveness, including Public Service Loan Forgiveness; and
- Avoid capitalization on accrued interest as long as you remain in income-driven repayment.
Additionally, if you are a veterinarian with Federal student debt who works for the government, (or other qualifying organization), your monthly student loan payments are also eligible for credit towards Public Service Loan Forgiveness (PSLF). Eligible PSLF payments have three requirements:
- Making payments on Federal Direct Loans
- Using an income-driven repayment plan (ICR, IBR, PAYE, REPAYE) for those Direct Loan payments
- Being employed by a Federal, State, Tribal, 501c3 or other eligible non-profit organization while making payments
After you complete 120 monthly, on-time, eligible payments over a minimum of 10 years, you are eligible to apply for PSLF. If you are granted PSLF, any remaining student loan balance is forgiven tax-free. That’s the best student loan deal going if you can manage it!
Want to review your student loan repayment strategy? Retrieve your student aid data file from studentaid.gov, upload your file to the VIN Foundation My Student Loans tool, review the summary report, and simulate your repayment options using the Student Loan Repayment Simulator.
Dr. Tony Bartels graduated in 2012 from the Colorado State University combined MBA/DVM program and is an employee of the Veterinary Information Network (VIN) and a VIN Foundation Board member. He and his wife 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 initiatives.
