# 110k student debt



## meowmix (31 Mar 2014)

Hi

I'm graduating medicine soon and starting work in July as a doctor. Like many in my graduate entry class I took out a large loan to cover fees and expenses. 

I'm just wondering if people have any advice on how to approach repaying this loan. I have heard of people paying down the loan in full in the first year with a 2nd loan under better conditions. Currently my bank are offering that the loan be repaid over 15 years. 

Any advice greatly appreciated


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## elcato (31 Mar 2014)

What's the current interest rate ?


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## meowmix (31 Mar 2014)

hi

it's 4.25%


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## Gerry Canning (31 Mar 2014)

meowmix; 
4.25% is a good rate.

Over 180 months that works out @ 828 per month.

You can always pay it off early , if you earn more.
Question is , Can you afford 828 every month?


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## Brendan Burgess (31 Mar 2014)

meowmix said:


> I have heard of people paying down the loan in full in the first year with a 2nd loan under better conditions.



Are you in Ireland? 

I very much doubt that anyone else will give you an unsecured loan over 15 years at 4.25%.

In fact, you would find it difficult to get a secured loan at this rate. 

Why not ask the people who claim to have got a better loan? 

The main "condition" of relevance is the APR.  If 4.25% is the APR, you won't do any better.

Which lender is it? 

Brendan


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## 44brendan (31 Mar 2014)

Can't be an Irish Bank. At a guess US!!


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## meowmix (31 Mar 2014)

It's with AIB, they had a special package for 4 year graduate entry medical students which has since been withdrawn. I'll be able to afford repayments but was just wondering should I secure a better loan, or negotiate for a longer repayment period or pay the loan off as quick as possible. 

Thanks for all your responses!


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## 44brendan (31 Mar 2014)

Didn't realise that AIB would approve student loans at this level unsecured! If they are now offering you an 18 year repayment schedule at mortgage rate equivalent, this sounds like a great deal. You will definitely not get a better deal elsewhere. Take the 18 year repayment schedule. This will give you the flexibility to pay it down more quickly when your financial position improves. I can't see the bank giving ypu a longer term than 18 years. I'm surprised that they would agree to 18 years!


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## meowmix (31 Mar 2014)

44brendan said:


> Didn't realise that AIB would approve student loans at this level unsecured! If they are now offering you an 18 year repayment schedule at mortgage rate equivalent, this sounds like a great deal. You will definitely not get a better deal elsewhere. Take the 18 year repayment schedule. This will give you the flexibility to pay it down more quickly when your financial position improves. I can't see the bank giving ypu a longer term than 18 years. I'm surprised that they would agree to 18 years!



It was initially supposed to be 10 years but they changed it to 15 when people started to run into difficulty 

Stay with AIB seems to be the consensus!


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## drincognito (2 Apr 2014)

Hi,

I'm in the unfortunate position of having the same loan as yourself and have been trying to negotiate with aib over the terms of the loan with little joy. Graduated last year and have started working as an intern.

These are the only options they offered to graduates of my med school last year:

1. Interest only for 1 year @ BLR +4.75%, being 5% in total as at todays date - 460 per month. At the end of the 1 year interest only, facility to be reviewed. 
2. Interest only for 3 years followed by 7 years Capital & Interest again at BLR +4.75%, Being 5% in total as at todays date. Interest only 460 per month & 1550 per month. 
3. Capital & Interest @ BLR +4.75%, being 5% in total @ repayments of 1160 per month. 

all options insist on full payment in 10 years.

So far most people I know are signing up to interest only repayments but the thoughts of aib looking for 1550e/month in a few years shocked me. So I've looked to negotiate on all aspects of the loan. 

AIB have refused to do this at a branch level and are forcing me to default before they will negotiate at all. I've had meetings with the assistant branch manager with no movement despite her review of my finances showing I cant even afford the interest only repayments by their calculations. 


Basic salary for an intern is approx 2300e/month net. including the small overtime payments we get nowadays. 

These loans were given out at a time when interns were taking home about twice the above amount and the reductions in salary are similar at all levels in medicine. 

AIB no longer gives these unsecured loans out. The maximum they will offer is fees only (60k) and all loans have a guarantor. 

Currently AIB have sent a demand for repayment of the loan which I replied to by saying the repayments as they stand are unmanageable in both the short and long term.  

I intend to pay the loan in full, but I've made a big mistake taking on this debt.....(as did AIB giving this cash out) 


Not sure where this will end up.......


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## 44brendan (2 Apr 2014)

Formal complaint now required to the Bank. Sometimes I despair at the so called solutions offered to bank clients who are genuinely prepared to service their loans. Clearly the bank knew when they offered you this facility that you would require a long term repayment schedule once you commenced earning. Unfortunately while you knew a number of others in the same boat as yourself, you did not get together to force the Bank to take a joint solution which was based on ability to repay over a reasonable term. It's not too late to lead the charge on that. Why not contact some of your fellow graduates and approach this from a combined perspective. The bank are clearly being unreasonable here and need to offer a solution that matches your repayment capacities.


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## Gerry Canning (2 Apr 2014)

With Brendan44 on his comments.

1. AIB lent the money in good faith.
2. You accepted the money in good faith.
3. Neither you or AIb foresaw that your future earnings would be much reduced.

AIB now require you adhere to original assumptions.
You have advised them that those assumption are now obsolate.
AIB are saying (tough & pay up).

Suggest , 
Put in writing to AIB your nett income , ask them to help advise you how to manage this debt . Assure them you intend to repay every cent.
Advise them that you do require their help on this .
Keep EVERYTHING in writing, 
The real upshot here is that AIB will be forced to properly reschedule the loan.
It is just a pity that these provn incompetnts refuse to see it!

ps; do NOT be or feel bullied.


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## drincognito (9 Apr 2014)

Thanks guys,

I've sent AIB a mail detailing pretty much what you suggested Gerry. 

Awaiting their response....


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## jonnykerry (9 Apr 2014)

I feel for you my friend,
As per Gerry, I hope you fight the good fight with the bank. It's shocking to think that you put yourself through Uni putting the hours in and studying and at the end of it there is no support from our government??

Just think if you sat on your behind since you left school you would of been handed the dole so take that at say 8 years at 10,000 a year= 80,000 cost to tax payer, yet a person like you who did something with there life gets no help! even though you will be a net contributor to society through your work and the taxes you pay.

"Long is the way
And hard, that out of hell leads up to light"
John Milton

Keep the faith


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## Bronte (10 Apr 2014)

jonnykerry said:


> It's shocking to think that you put yourself through Uni putting the hours in and studying and at the end of it there is no support from our government??
> 
> yet a person like you who did something with there life gets no help! even though you will be a net contributor to society through your work and the taxes you pay.


 
This is riduculous, how much did the government/Irish taxpayer subsidise your education?

What is BLR - B Loan Rate?

And the OP appears to have borrowed 110K over 4 years which works out at nearly 30K a year. This is without help from parents or money earner during college summers. How much does a medical student need to live on a year?


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## jonnykerry (10 Apr 2014)

I don't for one minute pretend to know the OP's living expenses, but I do know that higher education past a diploma/degree get's expensive. For example I'm looking at  2 year P/T masters and it's 20 grand. 
My point is the health system goes on recruitment drives all over the world yet we "grow" our own doctors at home so why not use this potential and say set up a system where the college/exam fee's are covered by the department in lieu of the graduate doctor signing a contract to stay in the public health system for say 5-7 years.

Any debt's out side of that is the individual's business.


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## drrkpd (14 Apr 2014)

The problem of debt from graduate medical students was entirely predictable. Although not stated I suspect the debt is for fees ( can be up to 20,000 per year) and living away from home - my son is in Uk and there is no change from 10,000 per year with long college weeks and limited possibility of paid work.
Irish doctors are NOT the best-paid on the world after tax and pension deductions and what hope if any have these students getting a mortgage? A consultant pay is now 106,000 which is a lot if money but comes down to 50,000 plus after all deductions and it can take 8 years to have a hope of becoming one. Not all doctors have huge private incomes. 
Their education was subsidised but they paid a huge amount of money as well. Student loans in the UK are set at a far lower repayment rate and are wiped out after a period of time.
Sadly these figures never made sense and they will emigrate and many will default on this debt. The difficulty comes then for the guarantors and this has been discussed in other forums.
Any prospective Student and their guarantors should read this posting and strongly consider the UK graduate entry programme.


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## drincognito (14 Apr 2014)

Bronte said:


> This is riduculous, how much did the government/Irish taxpayer subsidise your education?
> 
> What is BLR - B Loan Rate?
> 
> And the OP appears to have borrowed 110K over 4 years which works out at nearly 30K a year. This is without help from parents or money earner during college summers. How much does a medical student need to live on a year?



100k loan plus 10k in interest.

The average yearly cost going to college is €10,500 (educationireland.ie)

fees for Graduate Entry Medicine range from 14-16k/year for 4 years. 

BLR means base lending rate, a banking term.


Would love if there was a proper student loan system like in other countries.

However, the government in their wisdom don't seem to think it is necessary. 


Afraid I didn't have rich parents to fund my education and summers were mostly spent doing research or clinical electives for no pay.
But I did expect to have a high paying job to repay my debts when I finished. Things have changed....


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## drincognito (15 Apr 2014)

cashier said:


> If doctors are not well paid in Ireland why on earth are so many foreign doctors coming to work here then? I am sure they not coming for the fine weather so it must be the better pay and working conditions that's enticing them.



Rather silly statement that.

Irish doctors are leaving in their droves for first world health systems.....US, Canada, Australia, NZ, UK. Being replaced by doctors from very poor parts of the world.

If we want a 3rd world health service we are heading in that direction......

Perhaps we should compare your salary with someone doing the same job in Sudan?


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## drrkpd (15 Apr 2014)

Sadly Irish doctors are emigrating and I am afraid that some jobs in Ireland will not attract anyone even from poor parts of the world. This is slightly off topic however and distracts from the main point.
The important fact is that a medical student has been given a loan of 110,000 and has very limited chance of repaying it especially as it is on a variable rate.
If this was a 20 plus year old with a negative equity of 110,000 then there would a lot of correspondence but this person doesn't even have an asset except himself!!
No mention of security- suspect is unsecured - or guarantors and they must be having concerns at this point.


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