Is a 6 figure loan ever justifiable?

[D-Lux]

Just something for people thinking about public service jobs to keep in mind - they are extremely competitive right now. It's hard to say what the economy will be once you have finished your masters, but I have been applying to federal jobs for over 2.5 years without success. From my reading on various forums, this is the norm... it is hard to even get considered for a federal job without veterans' preference. Combine that with the budget problems and cuts, and it is kind of a crap shoot as to whether anyone will be able to depend on the debt forgiveness program.

Thanks for the input. It's worth mentioning that the forgiveness program applies to state and local government jobs as well, as well as non-profits.

[SaraDC]

Just something for people thinking about public service jobs to keep in mind - they are extremely competitive right now. It's hard to say what the economy will be once you have finished your masters, but I have been applying to federal jobs for over 2.5 years without success. From my reading on various forums, this is the norm... it is hard to even get considered for a federal job without veterans' preference. Combine that with the budget problems and cuts, and it is kind of a crap shoot as to whether anyone will be able to depend on the debt forgiveness program.

This is very true - not that the federal government doesn't need new people, it's that the hiring process is insanely burdensome and slow. One of the programs put in place to hire new grads was just done away with (some agencies were accused of abusing it). But when Obama came into office he pledged to streamline the process (no more KSA's, much shorter turn around) - but who knows when this will come into effect.

[fso2k11]

I think the federal government's debt program only applies to government subsidized and unsubsidized loans, of which the limit is ~20k/yr if I recall correctly. I am almost positive that the forgiveness program does not apply to private loans (although maybe you can consolidate and then they forgive that? I haven't looked into it).

This is very true - not that the federal government doesn't need new people, it's that the hiring process is insanely burdensome and slow. One of the programs put in place to hire new grads was just done away with (some agencies were accused of abusing it). But when Obama came into office he pledged to streamline the process (no more KSA's, much shorter turn around) - but who knows when this will come into effect.

[cckrspnl56]

PLUS loans, which can be taken out as much as the cost of attendance - other subsidized loans, count. I'm more than likely taking out 20.5k in Stafford, 35k in PLUS, a year.

[gopherpl]

Thanks for the input. It's worth mentioning that the forgiveness program applies to state and local government jobs as well, as well as non-profits.

Correct. I'm working in TX Government, and I have checked and the forgivness does apply to me.

[cckrspnl56]

Curious...Does anyone know what happens to SAIS scholarship funds that are offered to students who ultimately do not accept? Are they re-offered to those who didn't make the cut previously, offered to those on the waitlist, or are they simply thrown back into the moneypool?

[jph5125]

At Berkeleys visit day they were saying you could move around and still be eligible, so I think you are correct.

I have looked into this subject a lot since I am also planning on a similar path.

If you read the Public Service Loan Forgiveness Program PDF, which discusses IBR and the qualifications it states that you can indeed changes jobs and the jobs do not have to be consecutive. (i.e. You can work in a public service job for 3 years, do 1 year private, and then 7 years public service somewhere else). All the payments you make while not in a public service job do not count towards the 120 payments you are required to make. You may also not double up payments (i.e. pay double your monthly payment) as they will still count as only 1 of your 120 loan payments under the IBR PSLF.

You should keep detailed documentation of every place you have worked (job offer letters, pay stubs, W2s, etc). At some point in the unknown future the DirectLoans website will have a place where people applying for forgiveness programs can upload these documents to streamline the process (so they say at least).

[SaraDC]

I think the federal government's debt program only applies to government subsidized and unsubsidized loans, of which the limit is ~20k/yr if I recall correctly. I am almost positive that the forgiveness program does not apply to private loans (although maybe you can consolidate and then they forgive that? I haven't looked into it).

I'm in the process of trying to figure out how the loan process works and I came across this on the studentaid.ed.gov site:

Although loan forgiveness under this program is available only for loans made and repaid under the Direct Loan Program, loans made under other federal student loan programs may qualify for forgiveness if they are consolidated into a Direct Consolidation Loan. Therefore, only payments made on the Direct Consolidation Loan will count toward the required 120 monthly payments.