CCRAA/Loan Forgiveness Funding in the Future

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Will the funding actually be there for loan forgiveness?

Yes
5
83%
No
1
17%
Who cares I'm going BigLaw
0
No votes
 
Total votes: 6

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tallboone
Posts: 298
Joined: Thu May 21, 2009 12:27 am

CCRAA/Loan Forgiveness Funding in the Future

Postby tallboone » Thu Feb 11, 2010 5:31 pm

So how much does everyone trust that CCRAA Loan Forgiveness for public interest employees will actually exist in 2017 and beyond? It seems like with the budget deficit the way it is, the government might just look at having to forgive loans for thousands of state and federal employees and cut/revise funding. Thoughts?

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tallboone
Posts: 298
Joined: Thu May 21, 2009 12:27 am

Re: CCRAA/Loan Forgiveness Funding in the Future

Postby tallboone » Fri Feb 12, 2010 12:19 am

bump

smalltown
Posts: 82
Joined: Sat Aug 16, 2008 1:51 pm

Re: CCRAA/Loan Forgiveness Funding in the Future

Postby smalltown » Fri Feb 12, 2010 12:53 am

The point person from the Equal Justice Works was just at my school this week. The money is not going away for the IBR/Public interest funding. It's protected. Here's an answer to your question from these experts at EJW:

"IBR and Public Service Loan Forgiveness were passed into law through the College Cost Reduction and Access Act of 2007, and any major changes to these programs would require new legislation to be passed by Congress and signed by the president. This seems highly unlikely to occur in the foreseeable future, and we recommend that borrowers proceed with confidence."

The questions that remain in the future are whether or not we can get a tax break on the remaining debt forgiven for IBR after the 25 years. As it stands, the tax penalty could be in the 10s of thousands of dollars. But that's if you did pay your loans for 25 years. There is a bill in Congress to get that cleared up. The hope for passing seems lukewarm. But they have 25 years to get that worked out. Just to be clear, that has nothing to do with the PI program. That's all tax-free forgiveness after 10 years.

For any questions on these programs, the Equal Justice Works has a wonderful resource about it. They have several staff members dedicated to learning what the program will be. For instance, only Federal Direct Loans are forgivable in the PI program, not FFEL loans. If you have FFEL loans though, those can be consolidated. Go to http://www.equaljusticeworks.com for questions.




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