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Law School Revamps Public Service Loan Forgiveness

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by Mary Wood

Law School graduates who choose careers in public service will soon be able to take advantage of a more generous loan forgiveness program, the Law School announced Wednesday.

Under the new Virginia Loan Forgiveness Program (VLFP II), graduates who take public service jobs that pay less than $75,000 per year will be eligible for loan assistance. The new program will cover the entire annual loan payments for graduates who make $55,000 or less.

“The changes are designed to enable even more of our graduates to participate in the program with the goal of allowing students to pursue the careers they want regardless of educational debt,” said Dean Paul Mahoney.

Under the current loan forgiveness program, graduates who take public service jobs that pay less than $35,000 per year are eligible to have their entire loan payments covered. Raising that threshold will make public service work a viable possibility for more graduates, according to Jason Wu Trujillo, senior assistant dean for admissions and financial aid.

“Qualifying graduates who decide to work in public service will see less out-of-pocket expense than before,” Trujillo said.

The new program will be available to members of the Class of 2013 and later who enter qualifying employment within two years of graduation, or within two years of completing a judicial clerkship taken immediately after law school.

Qualifying positions include legal jobs with federal, state and local governments; legal aid offices; prosecutor offices; public defender offices; and legal reform groups that qualify as nonprofit organizations under the criteria established by federal tax law.

The new program also requires that participants place their loans in the federal Income Based Repayment Plan (IBR), which factors in annual income, educational debt and family size to determine a graduate’s monthly loan repayment obligation.

“The IBR plan structures graduates’ loan payments around their income,” said Director of Financial Aid Jennifer Hulvey. “For graduates who are making less, their payments will be less.”

The current loan forgiveness program requires that participants pay 50 cents on each dollar they make above $35,000 per year. For example, a graduate working in a public service job paying $55,000 per year would be required to pay $10,000 per year toward his or her loan repayment obligation, and the Law School would cover the rest.

In the new program, that same graduate would have 100 percent of his or her IBR-determined loan repayment obligation covered by the Law School. For graduates earning between $55,000 and $75,000, the new program will cover a prorated share of their loan repayment obligation under IBR.

Participants may stay in the new loan forgiveness program for up to 10 years. Under a separate federal loan forgiveness program, the federal government will forgive remaining student loan balances for graduates with qualifying loans who have worked in eligible public service jobs for 10 years.