Loan Repayment Assistance

 In 2007, Congress created the Public Service Loan Forgiveness (PSLF) program. Under PSLF, those who make 120 monthly payments (10 years) on their federal graduate student loans while employed full-time in qualified public service jobs are eligible to have their remaining balance forgiven. Congress is on the verge of eliminating the program. There is currently no guarantee that anyone would be grandfathered into the PSLF program. That means that people working in public service jobs over the past 8 years could receive no federal loan forgiveness at all. 

This is your chance to save #loan4giveness before it’s too late.

Loan Repayment Assistance

Many public service minded law school graduates can't afford to take the jobs they want because of overwhelming student loan debt. Members of Congress and federal agencies have tried to ease the loan repayment burden for lawyers who enter public service.

On October 23, 2008, the U.S. Department of Education released the final regulations governing the Public Service Loan Forgiveness and Income-Based Repayment programs of the College Cost Reduction and Access Act (P.L. 110-84). The regulations are available in full online.

Some clarifications and changes announced include:
• a rejection of annual certifications of eligibility;
• the intention to develop a form for borrowers to use to apply for the public service loan forgiveness;
• a revised definition of "full-time" (30 hours per week annual average) when a borrower works more than one qualifying job;
• clarification that Income-Base Repayment eligibility is based on the amount owed when the borrower first entered repayment, not the current amount owed;
• a decision that Family Medical Leave Act time off does not count in determining whether a borrower is considered full-time;
• the inclusion of intergovernmental or public regional agencies under the definition of government; and
• the determination that Peace Corps volunteers who decline the economic hardship deferment during service or make a lump sum payment on the loan from the Peace Corps transition allowance may meet the loan forgiveness payment requirement.

On Thursday, September 27, 2007, President Bush signed H.R. 2669, the College Cost Reduction and Access Act of 2007, into law (Public Law 110-84). Both the House (292-97) and Senate (79-12) had voted to approve the act, including the income contingent loan forgiveness program for public service, on September 7, 2007.

Under this program, the federal government will forgive the balance (including interest) of qualifying student loans for lawyers who provide "public interest law services"- including prosecution or public defense or legal advocacy in low-income communities at a nonprofit organization - or who are employed by a 501(c)(3) organization - after 120 timely income contingent repayments and 10 years of public service.

The act also offers borrowers another repayment option. During the period of repayment, borrowers of most federal and federally-backed loans may use the new Income Based Repayment Option to repay their loans at just 15 percent of their discretionary income, defined as their gross income minus 150 percent of the poverty line. The bill now awaits the President’s signature. H.R. 2669 passed in the house on July 11, 2007 by a vote of 273-149; it passed the Senate on July 20 by a vote of 78-18. See the linked article below for background information.

On July 24, 2007, the Senate unanimously passed S.1642, a bill that reauthorizes the Higher Education Act (HEA) and includes provisions from the John R. Justice Prosecutors and Defenders Incentive Act of 2007 (H.R. 916 and S.442) and a loan repayment program for civil legal assistance attorneys (first introduced by Sen. Tom Harkin in S.1167). This bill has not yet been voted on in the House.

Read more about efforts to assist public lawyers