Hofstra Law Review


In the College Cost Reduction and Access Act of 2007, Congress has created the income-based repayment (IBR) plan for student loans, through which graduates with high debts and low incomes may substantially reduce their monthly loan repayment obligations. Congress has also created a public service loan forgiveness plan, through which the federal government will forgive the remaining debt of borrowers who make 120 IBR (or certain other) payments while serving full time in public service jobs (very broadly defined). These programs are available to those who borrowed for graduate and professional training as well as for undergraduate education. These two programs will be of great value to public interest lawyers because of their typically high debts and low incomes, but they will also significantly assist social workers, government employees, soldiers, nurses, doctors, teachers, and many others who work in non-profit organizations and government agencies. This article explains why Congress created these two related programs, demonstrates the magnitude of the benefits available to representative borrowers, and outlines how graduates can obtain these benefits. It also elaborates how, even before the income-based repayment plan becomes effective in 2009, public service employees may make monthly repayments that will help to qualify them for eventual loan forgiveness. Finally, the article discusses the need for additional legislation to enable these new programs to achieve their objectives fully.

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