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As a lawyer, your earning potential is higher than most. However, you could still find yourself struggling to make ends meet if your law school debt is high or if you choose a career in public service.
If that’s the case, law school loan forgiveness can give you some much-needed relief.
- Income-driven repayment plan forgiveness
- Public Service Loan Forgiveness
- State-specific loan repayment assistance
- School-specific loan repayment assistance
- Attorney Student Loan Repayment Program
- Perkins Loan Cancellation
- The Herbert S. Garten Loan Repayment Assistance Program
- Other options for managing your law school loans
1. Income-driven repayment plan forgiveness
Best for: Federal loan borrowers with a low salary
If you have federal student loans and your income is low relative to your loan balance, you may be eligible for income-driven repayment (IDR) plan forgiveness.
With this approach, you sign up for an IDR plan. Your loan servicer will extend your payments to 20 to 25 years, and your minimum monthly payment will be capped at a percentage of your discretionary income. Depending on your income and family size, your monthly payment could become dramatically smaller.
Even better, your remaining loan balance after making 20 to 25 years of payments will be discharged. You’ll owe taxes on the forgiven amount, but it can still be a substantial savings.
2. Public Service Loan Forgiveness
Best for: Federal loan borrowers who work for a non-profit organization or government agency
If you have federal Direct student loans and work for a non-profit organization or government agency, such as a legal aid group or as a public defender, you may qualify for Public Service Loan Forgiveness (PSLF).
Under PSLF, you sign up for an IDR plan. After 10 years of making payments and working for a qualifying non-profit or government agency, your loans are completely discharged. And, the forgiven amount is not taxable as income, helping you save even more money.
Learn more: How to pay for law school
3. State-specific loan repayment assistance program
Best for: Those willing to fulfill service requirements in high-need states
Several states offer loan repayment assistance programs (LRAPs) to lawyers who commit to service terms. As part of the LRAP, you’ll receive money each year to repay some or all of your student loans.
For example, if you work for a civil legal aid organization in Florida, you can get up to $5,000 per year to repay your loans.
In Pennsylvania, attorneys who work for legal aid organizations and who make less than $66,000 per year can qualify for loan repayment assistance.
To find out if your state operates an LRAP, visit the Public Service Legal Careers website.
4. School-specific loan repayment assistance program
Best for: School alumni
Some schools operate loan repayment assistance programs for their alumni. While the terms can vary from school to school, you’ll generally have to work in the public interest sector and fall within set income requirements.
For example, those who graduated from American University’s Washington College of Law within the past three years may be eligible for its Public Interest Loan Repayment Plan (PILRAP). To qualify, you must work full-time in certain non-profit or government positions, make $75,000 per year or less, and have federal student loans.
Check with the American Bar Association to see if your school offers repayment assistance programs.
5. Attorney Student Loan Repayment Program
Best for: Those willing to make a three-year commitment with the Justice Department
If you’re an attorney, and an employee of the Justice Department, and are willing to continue working there for at least three years, you could qualify for the Attorney Student Loan Repayment Program (ASLRP). You could receive up to $6,000 in repayment assistance per year, up to a maximum of $60,000.
Only federal student loans qualify for ASLRP; private student loans are not eligible for repayment assistance.
Visit the ASLRP website for more information and to learn how to apply.
6. Perkins Loan Cancellation
Best for: Public defenders with Perkins Loans
If you have Perkins student loans — a federal student loan program that was discontinued in 2017 — and work as a public or community defender, you could be eligible to have 100 percent of your student loans forgiven after five years of service.
To apply for student loan discharge, you must contact your school or the school’s Perkins loan servicer. The school or servicer will provide you with the necessary forms to apply for loan cancellation.
7. The Herbert S. Garten Loan Repayment Assistance Program
Best for: Lawyers with loans totaling at least $75,000
If you have at least $75,000 in student loans and earn less than $62,500 within the 48 contiguous states ($78,125 in Alaska and $71,875 in Hawaii), you may be eligible for the Herbert S. Garten Loan Repayment Assistance Program. Under this program, the Legal Services Corporation selects 80 attorneys each year to receive loan assistance.
To qualify for the program, you must be employed with an LSC grantee organization and commit to a set service term. You can receive assistance if you have federal or private student loans.
Other options for managing your loans
While law school loan forgiveness initiatives and repayment assistance programs can be helpful to cut law school debt, but they’re not an option for everyone. If you work for a firm, are self-employed, earn too much money, or have private student loans, you likely won’t qualify for any form of loan forgiveness.
If you’re ineligible for these programs but are still struggling with your student loans, another option to consider is student loan refinancing.
Learn more: How to refinance law school loans
When you refinance, you work with a lender to take out a new loan for the amount of your current debt, including both federal and private loans. The new loan has completely different terms than your old ones; you’ll have a new interest rate, monthly payment, and repayment term.
If you have good credit, you could qualify for a lower rate, allowing you to save money. Or, if you want to reduce your monthly payment, you could opt for a longer loan term and get more breathing room in your budget.
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