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LRAP: George Washington University Law School

Published July 2010, last updated August 2010

Loan Reimbursement Assistance Program

How it Works
George Washington University Law School (GWU Law) graduates enrolled in the Loan Reimbursement Assistance Program (LRAP) receive a fully forgivable loan to help meet law school loan repayment. LRAP award amounts are determined based on an income threshold. If the graduate’s adjusted net income (as determined below) falls below this threshold, s/he will receive an award of up to $8,000.

Loans are disbursed twice yearly and forgiven at the end of each year provided the graduate remains in eligible employment. If the graduate leaves eligible employment within the first three months of the six-month period, s/he is expected to repay the entire loan. If the graduate leaves eligible employment during the second three months of the six-month period, s/he is expected to repay half of it.

Eligible Jobs
Graduates must be employed full-time (30+ hours/week) in a position requiring the use of a J.D. The position should serve underrepresented or indigent populations/individuals. Generally, this will be done in a nonprofit or government position, but for-profit positions where more than 50% of the work done is pro bono or reduced fee may also qualify.

Judicial clerkships and unpaid fellowships are not eligible.

Eligible Debt
Only law school approved and certified loans are eligible for coverage. Bar exam loans may also be covered. Undergraduate and other graduate loans are not covered.

The program does not require enrollment in IBR.

Calculation of Graduate’s LRAP Award
In order to determine the LRAP loan amount, the graduate’s adjusted net income must first be calculated. This is found by taking the graduate’s adjusted gross income and subtracting any dependent child deductions ($4,000 for the first child and $2,500 for each additional) and the annual law school loan repayment obligation.

Graduates are eligible to receive an LRAP award equal to the amount of the target income ($37,000) minus adjusted net income. The maximum amount of this award is $8,000. Of course, the award cannot exceed the amount of the graduate’s annual law school debt obligation. (In other words, if the graduate has $7,000 in yearly debt obligation, they are not eligible to receive more than $7,000.)

Although there is no published formula on how spousal assets or income may affect eligibility or award amount, documentation indicates that they may be taken into consideration. Similarly, significant expenses (medical, moving, etc) may also affect your net adjusted income.

Hypothetical Scenarios
Let’s explore just a few hypotheticals to see how GWU Law’s LRAP might function. In all situations below I assume the graduate receives the full amount for which s/he is eligible. It is advised that you consult with the GWU Financial Aid Office to determine the likelihood of this occurrence. (On the table of contents page you will find links to websites I used to calculate federal tax burden and yearly student debt obligations. Using these, you can input your own variables. Keep in mind that the take-home income amount does not reflect state or local taxes. Treat all hypothetical scenarios and amounts as approximations.)

Scenario One
Salary: $30,000
Salary less Taxes: ($30,000 - $4,081) = $25,919
Debt: $100,000 on a ten-year repayment plan at 6.8% interest
Yearly Debt Obligation (on ten-year repayment): $13,810
Adjusted Net Income: ($30,000 - $13,810) = $16,190
LRAP Award: $8,000 ($8,000 is the maximum award – difference between target income and adjusted net income is over $20,000)
Take-home Income: ($25,919 - $5,810) = $20,109

Scenario Two
Salary: $45,000
Salary less Taxes: ($45,000 - $7,438) = $37,562
Debt: $100,000 on a ten-year repayment plan at 6.8% interest
Yearly Debt Obligation (on ten-year repayment): $13,810
Adjusted Net Income: ($45,000 - $13,810) = $31,190
LRAP Award: ($37,000 - $31,190) = $5,810
Take-home Income: ($37,562 - $8,000) = $29,562

Scenario Three
A married graduate with no non-law school educational debt. The couple has two children. We’ll assume the award is not modified as a result of spousal income/assets.
Graduate’s Salary: $50,000
Graduate’s Salary less Taxes: ($50,000 - $8,681) = $41,319
Graduate’s Debt: $100,000 on a ten-year repayment plan at 6.8% interest
Graduate’s Yearly Debt Obligation (on ten-year repayment): $13,810
Adjusted Net Income: ($50,000 - $13,810 - $6,500 [dependent deduction]) = $29,690
LRAP Award: ($37,000 - $29,690) = $7,310
Graduate’s Take-home Income: ($41,319 - $6,500) = $34,819

Final Thoughts on the George Washington University Law School Loan Reimbursement Assistance Program
GWU warns that LRAP loans are not guaranteed to any graduates; selection into the program and amount of funding is up to the discretion of the LRAP Committee. Since the number of applicants increases every year, the maximum funding amount for each applicant may not always be possible.