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Planning for Success

Success in the classroom is no accident. It starts with a plan and requires steadfast determination, focus, initiative, and hard work. The Office of Financial Aid is committed to your success and would like to encourage students to utilize all available resources in the process of managing their financial affairs and planning for the future. We invite you to explore our comprehensive listing of links, resources, and planning tools, and contact us if you have questions. Anytime you need assistance, remember that our door is always open.

The American Association of Colleges of Osteopathic Medicine (AACOM) offers an online series of educational debt management modules designed to help osteopathic medical students and recent graduates. The modules’ content is updated to ensure consistency with current federal policies and regulations.

Each module contains specific information and resources to help osteopathic medical students borrow strategically and ensure they are prepared to responsibly repay their loans after they graduate and enter residency training.

The modules cover a broad scope of important financial aid and budgeting topics:

Module 1: Borrowing Considerations and Repayment Options
-Provides a summary of the financial aid landscape for incoming osteopathic medical students

Module 2: Student Loan and Financial Best Practices
-Identifies useful processes for managing student debt

Module 3: Choosing Between Federal and Private Repayment and Forgiveness Programs
-Offers helpful considerations for residents in planning their next steps for loan repayment

Module 4: Modern Student Loan Repayment Case Studies for Today’s Osteopathic Medical School Graduates
-Demonstrates ways in which information from the preceding modules is put into practice to create a long-term loan and debt management strategy

Module 5: Managing Your Income and Finances Early in Your Career
-Presents several practical life-long financial habits for physicians to develop early on

Cash Course is your guide to making informed financial choices. The site provides tool and resources covering a wide range of topics such as protecting credit, preventing identity theft, budgeting, financial planning, and managing debt. Get prepared for whatever life has in store. Register for a free account, and take charge of your money.

Financial Information, Resources, Services, and Tools (FIRST) is provided by the Association of American Medical Colleges (AAMC) and is intended to increase overall financial literacy among current and prospective medical students. FIRST provides a wealth of information to help you manage your finances, understand loan repayment options, learn about types of loan available, and much more.

For students who rely upon student loans to pay for the cost of their education, attaining and protecting a strong credit report is paramount. While Federal Direct Unsubsidized Loans are available to most students and are not based upon credit, they will not provide enough funding to cover all of a typical student’s educationally related costs. Students who wish to use loans to cover all of their expenses may need to borrow supplemental funds from additional sources such as credit-based Federal Direct PLUS Loans and private education loans. For aspiring physicians seeking these types of loans, credit management will play a major role in determining whether an application is approved.

Use a common-sense approach to maintaining a healthy credit report. Pay your bills on time. When possible, use cash or debit cards, and keep credit balances low. Don’t close old credit accounts, and don’t open new ones. Keep borrowing to a minimum, and always budget your funds carefully.

In addition, make a habit of monitoring your credit report. By law, you are entitled to one free copy of your report every year from each of the three credit reporting agencies. You can choose to access all three reports at once, or place three separate requests throughout a given year. Reports may be requested at https://www.annualcreditreport.com/cra/index.jsp.

Student loans, unlike grants and work-study, are borrowed money that must be repaid, with interest, just
like car loans and home mortgages. Loans cannot be canceled because of dissatisfaction with the
education you receive, inability to secure a job in your field of study, or financial difficulty. Loans are legal
obligations which must be repaid. Defaulting on your student loans can lead to serious consequences
including the loss of eligibility for federal student aid, collection fees, damage to your credit, and IRS
garnishment of your state and federal tax refunds. If you are having difficulty making your monthly
payments, do not hesitate to ask for help from your loan servicer or the Office of Financial Aid. Early
intervention is critical. Many options are available which may help you to avoid default.

A benefit to federal student loans is that, under certain conditions, students may be able to temporarily postpone loan payments through grace, deferment, or forbearance. Students enrolled in school, serving in the military, experiencing financial hardship, or completing a mandatory medical residency may qualify for one or more of these options.

Another benefit to federal loans is that students have a choice of several repayment plans designed to meet their individual needs. There are even plans designed to reduce a qualifying student’s monthly payment during periods of financial hardship. For eligible borrowers, the repayment period can range from ten to twenty-five years.

Federal Student Loan Repayment Information Tool

The U.S. Dept. of Education has launched a new web-based tool that will help borrowers “easily navigate the complexity of student loan repayment options.” The tool is geared to help students find their best repayment option in five steps or less and then provides information about the next steps to take. The Federal Student Loan Repayment Information Tool is available online at StudentLoans.gov/Repay.

Consolidation

Borrowers who have multiple federal student loans may wish to consolidate them into a single Direct Consolidation Loan. This may simplify repayment for those who are currently making separate loan payments to different loan holders or servicers, as they will only have one monthly payment to make. However, there may be tradeoffs to consider. The Dept. of Education provides an excellent resource for students who want to learn more about the advantages and possible disadvantages of consolidation.

Public Service Loan Forgiveness

In 2007, Congress created the Public Service Loan Forgiveness Program to encourage individuals to enter and continue to work full-time in public service jobs. Under this program, borrowers may qualify for forgiveness of the remaining balance due on their eligible federal student loans after they have made 120 payments on those loans under certain repayment plans while employed full time by certain public service employers. More Information

National Health Service Corps Loan Repayment Programs

The NHSC offers three loan repayment options for primary care providers who work at approved community sites.

Indian Health Service Loan Repayment Program

The Indian Health Service (IHS) Loan Repayment Program (LRP) offers health professionals the opportunity to pay off qualified student loans while assisting the IHS in meeting the staffing needs of Indian health programs. The LRP awards loan repayment to health professionals practicing in specific health profession disciplines who are willing to commit to an initial two-year service obligation while working in health facilities serving American Indian and Alaska Native communities.

National Institutes of Health Loan Repayment Programs

NIH offers loan repayment programs to outstanding health professionals who choose to pursue careers in biomedical, behavioral, social, and clinical research. If you commit at least two years to conducting qualified research funded by a domestic nonprofit organization or U.S. federal, state, or local government entity, NIH may repay up to $35,000 of your qualified student loan debt per year, including most undergraduate, graduate, and medical school loans.

Washington Student Achievement Council Health Professional Loan Repayment Program

The Health Professional Loan Repayment Program encourages licensed primary care health professionals to serve in Washington’s critical shortage areas. The program provides financial assistance through either conditional scholarships or loan repayment. The loan repayment portion of the program provides educational repayment assistance to licensed primary care health professionals. Applicants agree to provide primary care health care in rural or underserved urban areas with designated shortages.

Other State Loan Forgiveness/Repayment Programs

State governments often provide loan repayment programs as an incentive for service. The Association of American Medical Colleges (AAMC) provides an excellent resource for obtaining information on these programs. In addition, the NHSC provides a chart which shows all states that participate in their State Loan Repayment Program.

Military Health Professions Loan Repayment Program

The HPLRP is available from some branches of the US military. For terms and conditions, please contact a service branch representative.

With increasing frequency, federal student loan borrowers are being contacted by private lenders with offers to refinance federal loans into private consolidation loans. Before doing so, it is critical for each borrower to review the pros and cons of this type of loan consolidation and to gain a full understanding of the consequences of such a decision. The AAMC has published an excellent fact page which addresses the question, “Should I refinance my federal student loans?”