Why are people complaining about crushing debt when there's IBR?

[zaprowsdower]

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@cormy3

The Grad Plus loan and its interest rate will have to be swallowed with or without IBR.

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<p>Unless you get a lower-interest private loan.</p>

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Furthermore I found this guy’s forum post which says all that matters is your FICO score and the payment to income ratio

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<p>Well, some guy’s forum post notwithstanding, having a ton of debt is probably going to hurt your FICO score. And it’s probably not safe to assume that lenders are simply going to ignore the hundreds of thousands of dollars that you owe.</p>

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The only reason he would pay $1237 is if he weren’t simply using IBR: he can’t afford the original payment, and is therefore being saved by IBR.

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<p>Right, and the cost of being “saved” is that he ends up paying back a lot more than he otherwise would have, and/or getting hit with a huge tax charge at the end. That’s why people still complain about debt even though there’s IBR (in addition to the fact that many of them have loans that don’t qualify). Of course, you may be able to avoid most of the tax charge as long as you have few or no assets in your mid/late-forties. But that’s not really a great outcome, either.</p>