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IBR/PSLF and Forbearance

Hi all, Due to a job change, I anticipate that I will nee cautiouschuck03/05/18
DO NOT GO INTO FOREBEARANCE! What you do is you recertify du thirdtierlaw03/05/18
Based on my income, recalculating the numbers won’t help. cautiouschuck03/05/18
No - He's saying you recertify that your income is 0 because lilgub03/06/18
I don't know. Why don't you call the lender and ask? fettywap03/05/18
I know a lot of people on this forum have researched these t cautiouschuck03/05/18
I think she was being facetious... triplesix03/05/18
*whoosh* Totally over my head. cautiouschuck03/05/18
So what is the point of forbearance? It doesn’t sound like downwardslope03/05/18
Wrong on all points. Lower income, higher COL area, and rec cautiouschuck03/05/18
if your employer qualifies for PSLF you should definitely no shouldalearnedmath03/06/18
Calling your lender and asking is meaningless. In my case, t guyingorillasuit03/05/18
It is the number of payments that matter. Forbearance doesn' trollfeeder03/05/18
Usually you can get a forbearance for any reason as long as fettywap03/05/18
The servicers love forbearances and will be happy to give yo onehell03/06/18
The language he posted seems to say he can't take the forbea fettywap03/06/18
cautiouschuck (Mar 5, 2018 - 3:46 pm)

Hi all,

Due to a job change, I anticipate that I will need to enter into forbearance on my federal loans. However, Navient’s forbearance agreement makes me very uneasy. It appears to me to set up an argument that entering into forbearance makes one ineligible for PSLF. The agreement provides:

If your loan has a borrower benefit or repayment incentive that includes an on-time payment requirement to either obtain and/or retain the benefit after qualifying, using forbearance may forfeit your loan’s eligibility for the borrower benefit or repayment incentive. If Navient owns your loan, you should anticipate loss of benefits.

Any thoughts on whether forbearance could potentially result in forfeiture of PSLF eligibility? Thank you!

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thirdtierlaw (Mar 5, 2018 - 3:56 pm)

DO NOT GO INTO FOREBEARANCE! What you do is you recertify due to a change in income. They'll rerun the numbers and your monthly payment may go down to zero. Even if it goes to zero, you get credit for each month you "Make a zero" monthly payment.

Going into forbearance does not count towards your 120 monthly payments.

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cautiouschuck (Mar 5, 2018 - 4:02 pm)

Based on my income, recalculating the numbers won’t help. I’d absolutely be willing to (and expect to) lose out on qualifying payments in order to go into forbearance for a short period, but if it could conceivably affect my PSLF eligibility then I’d rather work the streets.

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lilgub (Mar 6, 2018 - 8:50 am)

No - He's saying you recertify that your income is 0 because it is allegedly 0 for a time.

If your issue is your worried your inability to pay for a few months is all that is at issue, it should not effect your eligibility, just that the payments due at that time won't count.

You shouldn't forfeit PSLF eligibility if your forbear, but YMMV. The program is so new, no one really knows.

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fettywap (Mar 5, 2018 - 4:15 pm)

I don't know. Why don't you call the lender and ask?

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cautiouschuck (Mar 5, 2018 - 4:46 pm)

I know a lot of people on this forum have researched these types of questions in detail, and I trust JDU as a starting point much more than I trust a customer service rep for the lender (unfortunately).

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triplesix (Mar 5, 2018 - 5:16 pm)

I think she was being facetious...

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cautiouschuck (Mar 5, 2018 - 5:36 pm)

*whoosh* Totally over my head.

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downwardslope (Mar 5, 2018 - 6:09 pm)

So what is the point of forbearance? It doesn’t sound like you can’t pay. It sounds like you are not interested in paying because you don’t have a qualifying job for forbearance purposes. That’s not a viable reason... they aren’t going to let you just stop paying your student loans just because you don’t feel like it. Typically that means you go into default.

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cautiouschuck (Mar 5, 2018 - 7:21 pm)

Wrong on all points. Lower income, higher COL area, and recently incurred debts due to life’s circumstances. This is the only debt I can conceivably take a pause on to catch up without ruining my credit. FYI, my employer does qualify for PSLF to the extent that is relevant.

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shouldalearnedmath (Mar 6, 2018 - 3:46 pm)

if your employer qualifies for PSLF you should definitely not lose your qualification for it. not sure if forbearance would really do that or not, but lets assume it does.

Depending on your loan balance you could be giving up 6 figures of future forgiveness. Have them recalc your payment and see how low it can go and try to live with it. Cancel cable, don't go out to eat, trim everything you can. Don't give up your ability to wipe out your loans in the next few years.

Now if your loan balance is like 20k or something. Maybe PSLF doesn't matter.

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guyingorillasuit (Mar 5, 2018 - 6:12 pm)

Calling your lender and asking is meaningless. In my case, the lender expressly told me something on which I then relied and refinanced, just to find out that I lost my qualifying years as a result. I complained to all possible entities, and the result was the same - I was told that I should have read the promissory note, and that I have no right to rely on the lender's verbal representations.

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trollfeeder (Mar 5, 2018 - 7:44 pm)

It is the number of payments that matter. Forbearance doesn't disqualify you from getting forgiveness, you just lose time that would have gone towards your forgiveness.

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fettywap (Mar 5, 2018 - 9:02 pm)

Usually you can get a forbearance for any reason as long as you have the time left. It's not based on income.

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onehell (Mar 6, 2018 - 1:12 am)

The servicers love forbearances and will be happy to give you one because interest accrues and capitalizes. You will lose those months towards PSLF or the much longer normal IBR forgiveness, but you can pick up where you left off. That said, most people's incomes rise over time and IBR adjusts accordingly. The later you reach forgiveness, the more you will pay in total over the life of the loan, odds are. So don't do it lightly.

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fettywap (Mar 6, 2018 - 5:10 pm)

The language he posted seems to say he can't take the forbearance with a Navient loan. Are you between jobs where you could claim your income is currently zero?

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