Generally, if we declare bankruptcy, whatever debt and loans we have will go away.
The result for some students is a portfolio of outstanding debt that includes loans carrying vastly different interest rates and repayment terms.
For some student-borrowers attending medical school, the most prudent approach is to group the loans together, into a single restructured consolidation loan.
There is no cap on the interest rate of a Direct Consolidation Loan.
Most medical students will take out loans when attending medical school.
If you want to lower your monthly payment amount but are concerned about the impact of loan consolidation, you might want to consider deferment or forbearance as options for short-term payment relief, or consider switching to an income-driven repayment plan.
Whom do I contact if I have questions about consolidation?
The best path for medical school loan consolidation varies, depending on what types of loans are held, and when they were originally issued.
Generally, students who consolidate realize these potential benefits: Federal Consolidation Loans are made available through the Federal Direct Student Loan Program.
In a sense, for the second year, we are paying interest on the prior interest. So with enough time, if none of the money is paid back, the money owed would be much, much more than the original 0. If you’re not careful, you can seriously get burned.
So if we decided to pay back the 0 loan we borrowed after 30 years, we would have to pay back 2.19. Obviously, with a higher interest rate, we would have to pay back more.
There is a joke between me and my friend that as medical students, we are poorer than a bum off the street. If we combine the loan with our lack of valuable possessions (assets), we will find that we have less than nothing — we owe money. I personally feel that tuition is way too expensive, but that is a topic for another day.