On Friday, President Trump signed the $2 Trillion COVID-19 stimulus package named the Coronavirus Aid, Relief, and Economic Security (CARES Act). The CARES Act provides some definite benefits if you have Federally held student loans. We wrote this article to help doctors with student loans understand and take advantage of the CARES Act benefits.
What is IBR? Don’t confuse the Income-Based Repayment plan (IBR) with Income-Driven Repayment plans (IDR). Income-Driven Repayments (IDR) refers to ALL student loan repayment plans that are based on your income and family size. IDR plans include Pay As You Earn (PAYE), Revised Pay As You Earn (REPAYE), and Income-Based Repayment (IBR).
When you borrow money from the Federal Government to pay for your education, you must pay back all of the borrowed money plus interest as a cost of borrowing that money.
The only time switching from SAVE to PAYE while still in residency will help is if your loan balance is low compared to your increasing income.
Pursuing PSLF and planning to switch from SAVE to PAYE after residency does not work. You are better off choosing the best plan up front or switching to PAYE or IBR while still in residency.
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