What is partial financial hardship?

What is partial financial hardship?


– Welcome to another edition of Flip The Script On Student Debt with our Joy Sorensen Navarre, President of Navigate. – Hi John. – Nice to see you today. – Thank you. What’s our topic? – Today’s topic is partial
financial hardship. We’ve heard that term a lot, especially with certain
income driven plans. What can you tell me about that? – Often that term, partial
financial hardship, keeps physicians from
thinking they might qualify for an income driven repayment plan so they think they make too much money. And they do make decent money. However, the size of their student loans is such that the number that is used to determine the partial
financial hardship number is also a very large number. So, often they do have a
partial financial hardship, especially during the early
parts of their career. Do you know how they calculate the partial financial hardship? – No, yeah. That’s where I’m a little fuzzy. Can you enlighten me please? – Will do. So, in order to have a
partial financial hardship, the borrower’s monthly
payment based on their income has to be less than what
their standard payment would be without using an
income driven repayment plan. – So, like on a 10 year repayment plan. – Exactly. – So, for example, if I had a 10 year
repayment of $2,500 a month, then if I wanted to get on one of these income driven plans, my payment on an income driven plan would need to be less than the $2,500. Correct? – Exactly. In that case, you would have
a partial financial hardship. – Well, that’s good to know. Thank you very much. – You’re welcome.

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