My wife's doctorate cost her $200k. The laws changed between her first year and her subsequent years; congress chose to allow naturopathic doctors access to the same financing as regular doctors. As such, we have two regimes of debt: one that counts as a small business loan and, as of May, about 37 that count as student loans.

The small business loan needed to be repaid pretty much as soon as she graduated. So that's been a bill we've had for three years now. It's about $12k or so and costs about $200 a month.

The student loans could be deferred and since my wife started her own practice and income was pretty light, we deferred them for a year. Now they're $230k.

In order to consolidate those loans into something that fits within the "income-adjustable" parameters, those 37 loans needed to become 1 loan. This took approximately 4 months worth of paperwork, a dozen tearful calls to clueless, disinterested interns that consistently gave the wrong information and, after much rending of clothing and heartbreak, one mammer-jammer of a loan that is now on income-adjustable payment.

Because 2009 was a shitty year, the income-adjusted payment on that loan is less than half the payment necessary to keep the interest flat. 15% of nothing is still nothing.

However, in 2007 congress passed a bill that forgives student loan debt after you make 360 payments (regardless of how much those payments are). So. Pay our bills on time for 30 years and we're out of debt, regardless of the fact that thanks to negative amortization, we'll owe $1.2 MILLION DOLLARS on that original $200k loan (presuming she never makes more than she makes now, which would suck).

Even better, since "doctor" is an "essential industry" she'll hopefully get to go for the 120 payments, rather than the 360 payments.

The new bill pushes that 360 payments to 240 for everybody, it looks like. It also pushes the income-adjusted qualifier from 15% to 10%.

I agree with steve that there has to be a balance... but student loans are fucking rapacious. You want education to start making sense again, stop giving humungous loans. The colleges get paid either way... so do the banks. The people who get fucked are the students and the taxpayer:

http://abovethelaw.com/2010/09/the-student-loan-racket-now-i...