Wednesday, June 24, 2009
Courtesy of the College Cost Reduction & Access Act. The online ABA Journal breaks it down this way:
On the public interest side, loan forgiveness works like this: After making loan payments for 10 years on government-backed loans, the government will forgive the loan balance for qualifying borrowers.
Then there's income-based repayment, in which monthly loan payments are capped at an amount relative to the borrower's income. After 25 years, the federal government will forgive any remaining loan debt, the NLJ notes. The income-based option wouldn't likely work for those landing $100,000-plus jobs out of law school. But those who are in the $60,000 pay range, but have more than $100,000 in debt, may be a good fit for the option.
The downside? (Isn't there always a downside?):
"The program is complicated enough that it is difficult for students to understand on their own," Heather Jarvis, a senior program manager at Equal Justice Works, told the NLJ. "As of right now, hardly anyone has a clue about this legislation, and in my mind it's the biggest thing to hit public service in a decade."
I am the scholarship dude.