loan debt student

Due to escalating tuition and easy credit, the U.S. has 101 people who owe at least $1 million in federal student loans, according to the Education Department. Compared to 2013, the numbers people owed that much is increasing more than seven times. Mike Meru is one of vocal person who burdened with student loan debt and frustrated with the high interest rates. He start a national dental-student movement to lobby Congress to lower rates on grad students.

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Investment & interest rate

Mike Meru, a 37-year-old orthodontist that actually serve under American Fork Modern Dentistry and Orthodontics made a big investment in his education. As of 25 May, he owed $1,060,945.42 in student loans. He picked the USC dental school in 2004-2005 school year due for its prestige and because he wanted to live closer to his parents. It estimated that the basic four-year program would require $400,000 to $450,000 in student debt, including interest.

Mr. Meru and his wife concluded dental school was a good investment, given the salary he expected to earn. Mrs. Meru said “There are certain things that are OK to go into debt for: a house, an education, a car.” At that time the rate for college and graduate students was 2.77% with some increasing in tuition fee during four years period. Things start going wrong after graduation due unanticipated of dental specialists residency tuition and lifestyle problem.

student loan justice

Lifestyle & family

After finishing the orthodontics residency in 2012, Mr. Meru used a government option known as forbearance, which allows borrowers to postpone payments. Mr. Meru said he earned little his first year out of school and needed all of it to support his family. Interest continued to accrue, expanding his debt through the magic of compounding.

The couple bought a home in Draper in 2012, using a $400,000 mortgage that Mrs. Meru took out in her name. She used an inheritance from her grandmother for the down payment. He and his wife, Melissa, have become numb to the burden, focused instead on raising their two daughters. “If you thought about it every single day,” Mrs. Meru said, “you’d have a mental breakdown.”

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Goodwill & refinancing solution

Mr. Meru found his calling while still a teenager. He was insecure over his crooked teeth and an irregular jaw line, he said: “I was embarrassed to talk to girls. Orthodontics changed my life.” Mr. Meru then entered into a government-sponsored repayment plan based on income. He agreed to monthly payments at 10% of his discretionary income, defined as adjusted gross income minus 150% of the poverty level. Any balance remaining after 25 years is forgiven, effectively covered by taxpayers. The forgiven amount is then taxed as ordinary income.


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