Deciding between a law school with a generous scholarship and a school with a well-known loan assistance plan, 30-year-old Michael Kaercher made his choice based on the loan assistance plan provided after graduation.
“I thought that if I ended up at a firm, then I wouldn’t miss the $100,000 in scholarships,” says Kaercher, who graduated from Harvard Law School in 2010 and works as an attorney adviser at the IRS. “But if ended up going into the public sector and went to Harvard, then I’d qualify for this program.”
Roughly half of law schools offer a loan assistance program to their graduates, but it’s usually limited it to those in the public sector and has an income cap.
“Harvard has one of the most generous programs that I’ve seen based on their formula,” says the fifth-year attorney, who receives $8,849 in loan assistance every six months from Harvard to pay his $220,000 law school debt. “You don’t have to work for a 501(c)(3) or anything like that in order to be eligible. You just have to not make that much money.”
Prospective and current law students as well as graduates should look at a law school’s loan assistance program – especially with rising student debt among law school grads.
Students from the Class of 2015 who borrowed to pay for law school took out around $110,618 in loans, according to data submitted to U.S. News by 183 ranked institutions.
More than 100 law schools offer some type of loan assistance program to their alumni, according to a list gathered by the American Bar Association.
Programs at law schools offer either a low income protection plan called a LIPP, or a loan assistance repayment program, known as an LRAP, which is more common.
“Obviously your top 20 schools are always going to have these programs,” says Lyssa Thaden, director of financial education at Access Group, a nonprofit that promotes affordable law school education. “There are those diamonds in the rough at lesser known institutions that have good LRAP programs.”
There are differences between a LIPP and an LRAP. “LIPP functions very much like a backend scholarship – we often describe it that way to students – because LIPP benefits can potentially be as generous as many up-front merit scholarships,” says Kenneth Lafler, assistant dean for student financial services at Harvard Law School.
LRAPs are typically limited to students entering public service. LIPPs are open to borrowers on an income sliding scale that includes the size of debt and cost of living, experts say. Other Ivy League law schools such as Yale Law School and Cornell University Law School offer similar programs.
LRAPs are tied to the federal Public Service Loan Forgiveness program, experts say. The program provides loan forgiveness to student borrowers working in the public sector after 120 months of qualified payments.
Stanford Law School has one of the country’s oldest LRAPs, providing more than $3 million annually to support 200 alumni in public service.
Afam Onyema, 37, who co-founded the Geanco Foundation, a nonprofit that conducts medical missions in Nigeria, receives enough assistance from Stanford to cover 85 percent of his loan repayments.
“This is not a traditional LRAP job like working as a public defender,” says the 2007 graduate, who turned down a $160,000 job at a law firm to pursue nonprofit work.
The Stanford grad says the program helped him pay more than half of his law school debt.
But not all schools with a LRAP structure require public service. Graduates from the University of Michigan—Ann Arbor Law School, aren’t limited to public sector work for their LRAP.
“Our only job requirement is that the graduate’s position is law-related,” says Lindsey Stetson, assistant dean for financial aid at the law school.
More laws schools are offering loan assistance. Thaden says many law schools began offering assistance programs in response to the backlash from debt-strapped students who were unable to find legal work easily.
“Law schools want to show they’re committed to the success of their students and alumni,” Thaden says.
While many program at presitgious law schools began offering these programs more than 30 years ago, other schools now provide LRAPs.
“We founded our program in 2007 in the spirit of helping out students in public service,” says Jeff Geldien, director of development and alumni relations at the Gonzaga University School of Law about the school’s LRAP. “Unfortunately only those in public service are eligible for it.”
The program doesn’t require its recipients to enroll in an income-based repayment plan, which is often a requirement at other schools, he says.
“I’m not sure how many students think about this while they’re in school,” Geldien says. “But if there are qualifying services then that graduate should take advantage of it whether it’s our law school or any law school.”