SL - Defer or keep paying low IBR payment?

[Anonymous]

Good morning all,

I just wanted to quickly ask if it would be more advantageous for me to keep paying the low monthly IBR payments while im a full-time MBA student or if I should ask for them to be deferred?

I'm very much trying to bounce back from bad credit decisions years ago and rebuild my credit - I'm just hovering around the 600 mark on all 3 CRAs at the moment with the goal of buying a house about 2 years from now.  The payments only equal a few hundred dollars and I can easily handle that, but it would be nice to focus that on some other financial goals as well.

[Anonymous]

IBR is a great program. I think the decision to keep paying or defer depends on you. Personally, I would keep paying on the loans if you have the means. It means reducing your overall debt and saving on the interest. If they're deferred, the interest is just going to keep growing and growing. Best to get started now and pay as much as you are able. 

[Anonymous]

Have to do what works for you, but it's nice if you can keep that interest in check. When it capitalizes later it stings. Not only does it cost you more, but it throws off your UTI on installments. While not as weighted as revolving UTI, it does have an impact as several threads have explored in the forums. 

I had an original SL of 6250. With deferring it ended up becoming close to 7k. It's at 6850 now but shows over 100%. Fortunately, I have an auto loan that's lower that is helping balance out my overall profile a little better.

I'm not too worried about it now as I'm not applying for anything. I'm aggressively paying the auto and then will put a big dent in the SL.

For me, deferring did help me manage what I needed better and then now I'm in a position (less debt and making more money) that I can address it. Sometimes that's worth it. 

Do what you feel best about. Different things feel better to different people. Minimize stress!