Why should I be worried about debt when there is IBR?

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Mr. Somebody
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Why should I be worried about debt when there is IBR?

Postby Mr. Somebody » Tue Jul 03, 2012 11:56 am

Worst comes to worst I can use IBR and I'll be just fine.

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fatduck
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Re: Why should I be worried about debt when there is IBR?

Postby fatduck » Tue Jul 03, 2012 11:58 am

Mr. Somebody wrote:Worst comes to worst I can use IBR and I'll be just fine.

okay.jpg

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joemoviebuff
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Re: Why should I be worried about debt when there is IBR?

Postby joemoviebuff » Tue Jul 03, 2012 11:58 am

Until you hit the 25th year and get stuck with a gigantic tax bomb, then get to declare bankruptcy when you're 50. If that qualifies as "just fine," then by all means, go ahead.

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sd5289
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Re: Why should I be worried about debt when there is IBR?

Postby sd5289 » Tue Jul 03, 2012 12:00 pm

should I be worried about debt?


Yes.

The answer to this is always yes.

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kapachino
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Re: Why should I be worried about debt when there is IBR?

Postby kapachino » Tue Jul 03, 2012 12:08 pm

IBR is subject to change, which a lot of people tend to forget. The thing about taking on so much debt and counting on IBR is that your financial life will be shit until IBR takes effect, if it indeed stays as it is when you sign up for it. It's not a good way to start out. Are you interested in doing PI? If so, there are two programs that could help you: LRAP (if your school has it) and PSFL. I'd look into those and then decide if taking on a mountain of debt is worth it.

admisionquestion
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Re: Why should I be worried about debt when there is IBR?

Postby admisionquestion » Tue Jul 03, 2012 12:22 pm

can someone explain the tax bomb thing to me...

not going to be using IBR, so dont beat me up for not knowing, just curious.

ineptimusprime
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Re: Why should I be worried about debt when there is IBR?

Postby ineptimusprime » Tue Jul 03, 2012 12:27 pm

I'm pretty sure the "forgiven" remaining balance is counted as income.

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rayiner
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Re: Why should I be worried about debt when there is IBR?

Postby rayiner » Tue Jul 03, 2012 12:36 pm

admisionquestion wrote:can someone explain the tax bomb thing to me...

not going to be using IBR, so dont beat me up for not knowing, just curious.


If your IBR payments don't cover your accrued interest, it will continue to accrue (it will not, however, be capitalized--under IBR federal loans are simple interest). At the end of the period you'll owe like $500k. When that's forgiven it will count as income and will generate a $200k tax bill.

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sunynp
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Re: Why should I be worried about debt when there is IBR?

Postby sunynp » Tue Jul 03, 2012 12:37 pm

How will you be fine with that massive amount of debt hanging over you? Will you be able to buy a house or a car? I suppose maybe a car because that can be repossessed. Will you ever have sayings? You will be in debt for school longer than you have been alive so far (for most people, anyway.) Will you find a partner to marry with that much debt?

Here is another problem with IBR - the documentation and dealing with it is a complete hassle, I've read. They take your tax return once a year. There is no provision to help you if you lose your job in between that time. There have been many consumer complaints about dealing with IBR. It isn't a simple thing and it has been designed as a measure of last resort for people. IBR is the thing that keeps people from committing suicide over the stress of debt they can't repay, it doesn't mean your life will be fine.

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alwayssunnyinfl
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Re: Why should I be worried about debt when there is IBR?

Postby alwayssunnyinfl » Tue Jul 03, 2012 12:39 pm

rayiner wrote:
admisionquestion wrote:can someone explain the tax bomb thing to me...

not going to be using IBR, so dont beat me up for not knowing, just curious.


If your IBR payments don't cover your accrued interest, it will continue to accrue (it will not, however, be capitalized--under IBR federal loans are simple interest). At the end of the period you'll owe like $500k. When that's forgiven it will count as income and will generate a $200k tax bill.

Does the IRS have an IBR program?

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IAFG
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Re: Why should I be worried about debt when there is IBR?

Postby IAFG » Tue Jul 03, 2012 12:42 pm

alwayssunnyinfl wrote:
rayiner wrote:
admisionquestion wrote:can someone explain the tax bomb thing to me...

not going to be using IBR, so dont beat me up for not knowing, just curious.


If your IBR payments don't cover your accrued interest, it will continue to accrue (it will not, however, be capitalized--under IBR federal loans are simple interest). At the end of the period you'll owe like $500k. When that's forgiven it will count as income and will generate a $200k tax bill.

Does the IRS have an IBR program?
Yes, the "fuck you, pay me" plan.

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rayiner
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Re: Why should I be worried about debt when there is IBR?

Postby rayiner » Tue Jul 03, 2012 12:44 pm

This is why we can't have nice things (like safety nets). Because stupid fuckwads use it as carte blanche to make stupid fuckwad decisions.

admisionquestion
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Re: Why should I be worried about debt when there is IBR?

Postby admisionquestion » Tue Jul 03, 2012 12:45 pm

rayiner wrote:This is why we can't have nice things (like safety nets). Because stupid fuckwads use it as carte blanche to make stupid fuckwad decisions.


What is wrong with you?

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rayiner
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Re: Why should I be worried about debt when there is IBR?

Postby rayiner » Tue Jul 03, 2012 12:47 pm

admisionquestion wrote:
rayiner wrote:This is why we can't have nice things (like safety nets). Because stupid fuckwads use it as carte blanche to make stupid fuckwad decisions.


What is wrong with you?


Wasn't talking to you, was talking to "Mr. Somebody".

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IAFG
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Re: Why should I be worried about debt when there is IBR?

Postby IAFG » Tue Jul 03, 2012 12:48 pm

rayiner wrote:This is why we can't have nice things (like safety nets). Because stupid fuckwads use it as carte blanche to make stupid fuckwad decisions.

"Since hospitals have to provide emergency treatment, imma skip the helmet on my motorcycle!"

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alwayssunnyinfl
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Re: Why should I be worried about debt when there is IBR?

Postby alwayssunnyinfl » Tue Jul 03, 2012 12:50 pm

IAFG wrote:
rayiner wrote:This is why we can't have nice things (like safety nets). Because stupid fuckwads use it as carte blanche to make stupid fuckwad decisions.

"Since hospitals have to provide emergency treatment, imma skip the helmet on my motorcycle!"

I actually know several people who think this way. Darwinism at its finest.

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sunynp
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Re: Why should I be worried about debt when there is IBR?

Postby sunynp » Tue Jul 03, 2012 12:53 pm

Here is one simple administrative issue with IBR. Banks hate it and want to make it as hard as possible. So you have an annual anniversary to provide income information, but the bank doesnt have to tell you when it is. If you miss the deadline, you are back to a much higher payment. It takes 3 months to process the paperwork!

If you're already in IBR, make sure your lender has updated income information for you before the annual anniversary of your enrollment in the program, so they can determine your payment for the next year. Missing your deadline can result in a much higher payment that doesn't take your income into account. Currently, lenders aren't required to notify borrowers about this crucial deadline. Borrowers have reported that it can take up to three months to process the paperwork, and processing delays can also trigger a high payment.


http://www.ibrinfo.org/index.php

admisionquestion
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Re: Why should I be worried about debt when there is IBR?

Postby admisionquestion » Tue Jul 03, 2012 12:53 pm

I dont mean to overreact, but I fail to see how complaints with a poorly designed (or so it seems) safety net for student debt, translates into an pro conservative discussion on medical care...


One safety net is bad, so they all are?
or to be more generous are you saying, "because people misunderstand one safety net and make bad decisions they will do so with all safety nets..."

Either way, wtf?

@darwinism comment, THAT IS NOT DARWINISM. IT HAS NOTHING TO DO WITH DARWINISM. IT HAS NOTHING TO DO WITH HOW SPECIES EVOLVE OUT OF OTHER SPECIES OVER TIME. IT HAS TO DO WITH STUPID PEOPLE DYING. It does not indicate if these same stupid people had ample time to procreate prior... For all you know this system of extra fun ski time is causually linked to them being MORE LIKELY to have unprotected sex the night before...

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moneybagsphd
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Re: Why should I be worried about debt when there is IBR?

Postby moneybagsphd » Tue Jul 03, 2012 12:55 pm

I was surprised to see OP-- i.e. not a troll-- authored this abortion of a thread.

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Colonel Angus
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Re: Why should I be worried about debt when there is IBR?

Postby Colonel Angus » Tue Jul 03, 2012 12:56 pm

IAFG wrote:
rayiner wrote:This is why we can't have nice things (like safety nets). Because stupid fuckwads use it as carte blanche to make stupid fuckwad decisions.

"Since hospitals have to provide emergency treatment, imma skip the helmet on my motorcycle!"

Don't knock this line of reasoning, you may need a liver or other vital organ someday.

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sunynp
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Re: Why should I be worried about debt when there is IBR?

Postby sunynp » Tue Jul 03, 2012 12:56 pm

admisionquestion wrote:I dont mean to overreact, but I fail to see how complaints with a poorly designed (or so it seems) safety net for student debt, translates into an pro conservative discussion on medical care...


One safety net is bad, so they all are?
or to be more generous are you saying, "because people misunderstand one safety net and make bad decisions they will do so with all safety nets..."

Either way, wtf?

@darwinism comment, THAT IS NOT DARWINISM. IT HAS NOTHING TO DO WITH DARWINISM. IT HAS NOTHING TO DO WITH HOW SPECIES EVOLVE OUT OF OTHER SPECIES OVER TIME. IT HAS TO DO WITH STUPID PEOPLE DYING. It does not indicate if these same stupid people had ample time to procreate prior... For all you know this system of extra fun ski time is causually linked to them being MORE LIKELY to have unprotected sex the night before...


What thread is that from? Can you please start a new thread if you want to discuss this. I would love to have one thread on TLS where we can discuss that IBR isn't a free ride to borrow $250,000 for law school.

admisionquestion
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Re: Why should I be worried about debt when there is IBR?

Postby admisionquestion » Tue Jul 03, 2012 12:57 pm

sunynp wrote:
admisionquestion wrote:I dont mean to overreact, but I fail to see how complaints with a poorly designed (or so it seems) safety net for student debt, translates into an pro conservative discussion on medical care...


One safety net is bad, so they all are?
or to be more generous are you saying, "because people misunderstand one safety net and make bad decisions they will do so with all safety nets..."

Either way, wtf?

@darwinism comment, THAT IS NOT DARWINISM. IT HAS NOTHING TO DO WITH DARWINISM. IT HAS NOTHING TO DO WITH HOW SPECIES EVOLVE OUT OF OTHER SPECIES OVER TIME. IT HAS TO DO WITH STUPID PEOPLE DYING. It does not indicate if these same stupid people had ample time to procreate prior... For all you know this system of extra fun ski time is causually linked to them being MORE LIKELY to have unprotected sex the night before...


What thread is that from? Can you please start a new thread if you want to discuss this. I would love to have one thread on TLS where we can discuss that IBR isn't a free ride to borrow $250,000 for law school.




Thats fine. im responding to stupid shit people are saying in this thread. Im confused by your confusion.

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IAFG
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Re: Why should I be worried about debt when there is IBR?

Postby IAFG » Tue Jul 03, 2012 12:58 pm

admisionquestion wrote:I dont mean to overreact, but I fail to see how complaints with a poorly designed (or so it seems) safety net for student debt, translates into an pro conservative discussion on medical care...


One safety net is bad, so they all are?
or to be more generous are you saying, "because people misunderstand one safety net and make bad decisions they will do so with all safety nets..."

Either way, wtf?

@darwinism comment, THAT IS NOT DARWINISM. IT HAS NOTHING TO DO WITH DARWINISM. IT HAS NOTHING TO DO WITH HOW SPECIES EVOLVE OUT OF OTHER SPECIES OVER TIME. IT HAS TO DO WITH STUPID PEOPLE DYING. It does not indicate if these same stupid people had ample time to procreate prior... For all you know this system of extra fun ski time is causually linked to them being MORE LIKELY to have unprotected sex the night before...
You seem confused and mad. Unattractive combination. No one ITT is upset the safety net exists. We are upset that people use the safety net to indemnify their idiotic choices. You can be happy about a system and still be pissed at its abusers. And I don't think they "misunderstand" the safety net at all.

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sunynp
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Re: Why should I be worried about debt when there is IBR?

Postby sunynp » Tue Jul 03, 2012 12:59 pm

admisionquestion wrote:
sunynp wrote:
admisionquestion wrote:I dont mean to overreact, but I fail to see how complaints with a poorly designed (or so it seems) safety net for student debt, translates into an pro conservative discussion on medical care...


One safety net is bad, so they all are?
or to be more generous are you saying, "because people misunderstand one safety net and make bad decisions they will do so with all safety nets..."

Either way, wtf?

@darwinism comment, THAT IS NOT DARWINISM. IT HAS NOTHING TO DO WITH DARWINISM. IT HAS NOTHING TO DO WITH HOW SPECIES EVOLVE OUT OF OTHER SPECIES OVER TIME. IT HAS TO DO WITH STUPID PEOPLE DYING. It does not indicate if these same stupid people had ample time to procreate prior... For all you know this system of extra fun ski time is causually linked to them being MORE LIKELY to have unprotected sex the night before...


What thread is that from? Can you please start a new thread if you want to discuss this. I would love to have one thread on TLS where we can discuss that IBR isn't a free ride to borrow $250,000 for law school.




Thats fine. im responding to stupid shit people are saying in this thread. Im confused by your confusion.


The stupid shit is that IBR is a good reason to borrow to law school. I think OP was probably trolling for this reaction anyway.

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alwayssunnyinfl
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Re: Why should I be worried about debt when there is IBR?

Postby alwayssunnyinfl » Tue Jul 03, 2012 1:00 pm

admisionquestion wrote:@darwinism comment, THAT IS NOT DARWINISM. IT HAS NOTHING TO DO WITH DARWINISM. IT HAS NOTHING TO DO WITH HOW SPECIES EVOLVE OUT OF OTHER SPECIES OVER TIME. IT HAS TO DO WITH STUPID PEOPLE DYING. It does not indicate if these same stupid people had ample time to procreate prior... For all you know this system of extra fun ski time is causually linked to them being MORE LIKELY to have unprotected sex the night before...

Outed as never having heard of social darwinism.




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