The New Federal Student Loan Repayment and Forgiveness Law: How it Will Affect Law Graduates and Law Schools
Philip G. Schrag, Georgetown University Law Center
In September, 2007, Congress passed the College Cost Reduction and Access Act (P.L. 110-84). Section 203 allows much lower monthly “income-based” repayments (IBR) than was previously permitted. Section 401, enacted with strong support from the ABA and the AALS over a seven year period, provides a large measure of loan forgiveness for graduates who spend ten years working in government agencies and non-profit (Sec. 501(c)(3)) organizations.
The IBR system will significantly alleviate the loan repayment burden on law graduates in their first years after graduation, making it possible for many more graduates to consider working for smaller law firms that do not pay salaries as high as those paid by large corporate firms. The loan forgiveness provision will enable thousands of law graduates to choose the careers that they desire in lower-paying public service jobs.
Through a powerpoint exposition of the law, demonstration of a web-based IBR calculator, discussion by panelists, and audience participation, this panel will explain the new law and its implications for law graduates and law schools (including law schools that have their own loan repayment assistance programs). The panel will also examine ways in which Congress could improve on what it has already done.