Graduate school students who finance their degrees with loans typically come out of school with pretty heavy debt. And law school grads have some of the highest debt balances among all borrowers. This is because need-based grant aid in the graduate world, including law, is painfully minimal. Most of the need-based aid is in the form of loans. But some law schools in the United States are working to somewhat reduce their students’ debt burden. To make things a little easier on outgoing students, around US 100 law schools offer loan repayment assistance programs (LRAP) to certain graduates.
Many of these loan repayment programs give assistance to graduates working in public interest law jobs. Much like Public Service Loan Forgiveness, the programs are meant to help those who want to work in public interest jobs but would otherwise not have been able to make it work financially. Public service jobs are often much lower-paying than private practice. Out of these 100 schools, Yale Law School has a unique loan repayment program for its graduates. The school offers need-based grant aid to students, as well as a loan repayment assistance program for eligible students in both the public and private sectors.
Yale’s Career Options Assistance Program (COAP) was established in 1989 to give graduates of Yale Law assistance on their loans that would allow them to pursue the field of law that they wished, rather than what happens to be most lucrative. Based on their income, Yale will cover a portion of their monthly payment. If a graduate in COAP is on an income-driven repayment plan (IDR), the assistance could cover the whole payment. (See this video on student debt by Tasha and Joseph of One Big Happy for an example of COAP in action.)
Why don’t these institutions just waive tuition for certain students? Loan repayment assistance guarantees that the aid is going to graduates who are working and in good standing with the institution. Graduates meeting those requirements make the institution look good. In a sense, students take on a risk by taking out loans, but are rewarded by their successful completion of law school, good standing with their institutions, and their employment in the field of law.
However, less than half of US law schools offer a loan repayment assistance program. Institutions with large endowments like Yale have more flexibility to be generous with their graduates. Other institutions may need the law school to balance their budgets, as the “cash cow graduate school” phenomenon persists. That’s a topic for another time, though!
Loan repayment assistance is also expanding outside the law school realm. Beneficiaries of the Yale repayment program, appreciative of their experiences, started a loan repayment assistance company of their own: LRAP Association. Individual institutions can purchase the company’s services on a per-student basis. If enrolled students have limited incomes after graduation, the company helps repay their loans. The program works for for undergrad and graduate students alike.
The creation of LRAP Association may be a signal that loan repayment assistance could become more and more common. And while this assistance may be a boon for graduates who have modest incomes, it still leaves others out. People with student debt who are in default often have no degree. Law students, even if they do graduate, may also be under- or unemployed. These students may not qualify at all for assistance but still need all the help they can get.
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