Consolidated loan>>PSLF

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  • #49658
    RGB
    Member

    Good day-
    So I decided to consolidate my loans in 4/2019 then I was approved for the Public service loan forgiveness which then transferred my loans to Fed loans. I just started my first payment July 1st. If I’m looking to purchase within 3-6 months and just started paying off my loans would this hold me back without 12 months payment history. My loans were IBR and was paying $0. Naca counselor said that was unacceptable and that’s why I decided to just consolidate to have an idea what my payments would be.

    Thanks

    #49718
    TTrumble
    Member

    Hello Rgbkitty,

    The consolidation was in fact unnecessary and may indeed hold you back. While we must have a non-zero payment figure for student loans when calculating your budget and affordability, there are several ways of obtaining that figure with an IBR plan showing a zero payment. These include obtaining a letter from the lender stating how much you would be paying based on your income if you were not in a zero-plan, and creating a figure using the official payment calculator that exists online.

    The consolidation is the creation of a new line of credit which will now require a twelve-month payment history before you can be qualified.

    Not to add insult to injury, but 96% of those who enter the Public Service Loan Forgiveness program fail to achieve the objective of their loan being erased. Many fail because of a “technicality” of some sort usually involving failure to comply with some small detail. A quick search on the web will take you to several articles regarding the issue. Were the PSLF program in the private sector instead of a government program, it would immediately be branded as a scam.

    I’m truly sorry I can’t bring you more positive news.

    Tim Trumble
    Online Operations, NACA
    ttrumble@naca.com

    • This reply was modified 1 year, 1 month ago by TTrumble.
    • This reply was modified 1 year, 1 month ago by TTrumble.
    #49732
    RGB
    Member

    Hello TTrumble-

    Consolidating my loan is way more affirdable and reduces my monthly obligations sustantially. I’m hoping this won’t hold me back and would be at the discretion of the underwriter. I was at the at the ATD event in New york and was told otherwise. Thank you for your prompt response.

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