Question for the student loan gurus about an “expected” negative interest accrual and “expected” negative expected amount to be repaid.
I just switched from IBR to REPAYE. My loans are through Nelnet. Nelnet has a page called “Payment Schedule”, which gives basic info about your loans, and estimates your expected interest / principal payments over the life of your loans. I just checked out the “Payment Schedule” page to check out the impact of my switch to REPAYE. To my surprise, a couple of the numbers are now negative. I have no idea what this means. I called Nelnet, and the guy said he has no idea and has never seen negative numbers before. I’ve fudged the numbers a bit for internet privacy concerns, but I recreated the “Payment Schedule” page below so you guys can take a look. Let me know if any of you can explain why a couple of these numbers are negative.
Loan Type: DIRECT LOAN STAFFORD UNSUB
Interest Rate: 6.550%
Outstanding Principal Balance: $14,000
Unpaid Fees/Other Charges: $0.00
Unpaid Interest to be Capitalized: $0.00
Interest Not Capitalized: $700
Estimated Interest Accrual Over Loan Term: -$16,000.
Interest Paid as of 03/07/2017: $500.00
Total to be Repaid: -$1,500
May 3, 2014
This is definitely strange. Does it really say you will be paying -$16,000 on a $14,000 loan? That doesn’t make any sense.
Is your REPAYE payment really low? Like less than $100 per month?
If this is not an error, it could be because of the way REPAYE treats unpaid interest. If your monthly interest is more than your monthly payment, I believe that RPEAYE forgives half of that extra interest (in an effort to prevent the loan from going out of control). This term is unique to REPAYE, so that might be a factor here.
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