PSLF revisions: New budget proposal screws anyone in PI. Forum

[Cal Trask]

Press release acknowledges full forgiveness of PSLF

http://m.whitehouse.gov/the-press-offic ... affordable

Where exactly is there any new information in here on PSLF? Am I just not seeing it?

[Ded Precedent]

Press release acknowledges full forgiveness of PSLF

http://m.whitehouse.gov/the-press-offic ... affordable

Where exactly is there any new information in here on PSLF? Am I just not seeing it?

Nothing new about PSLF and PSLF has always been "full forgiveness" so I dunno. From what I can tell all that happened is that Obama extended PAYE to all loans old and new.

[jaydizzle]

So, we will all be able to do PAYE and forgiveness after 10 years if we are in public service? I have Some loans from August 2007 .

[Tiago Splitter]

Press release acknowledges full forgiveness of PSLF

http://m.whitehouse.gov/the-press-offic ... affordable

Where exactly is there any new information in here on PSLF? Am I just not seeing it?

Nothing new about PSLF and PSLF has always been "full forgiveness" so I dunno. From what I can tell all that happened is that Obama extended PAYE to all loans old and new.

The point is that this thread got to 28 pages because people were freaking out about forgiveness being limited in some way. This press release says nothing about capping PSLF at 57.5k as had been previously discussed, and in fact says ANY remaining balance is forgiven after ten years.

[jaydizzle]

What's the effective date on this? Currently, I do not qualify for PAYE, but with this I will.

[Should I Transfer??]

What's the effective date on this? Currently, I do not qualify for PAYE, but with this I will.

PAYE has been extended to nearly everyone. People who were previously ineligible because of pre-2007 loans or lack of post-2011 loans will eventually be eligible for PAYE. Obama has ordered the Department of Education to implement regulations making this change by December 31, 2015. However, there is uncertainty regarding precisely what the regulations implementing Obama's executive order will look like. For instance, the regulations could merely expand the program to previously ineligible borrowers, under the same terms as currently eligible borrowers. Seemingly, the regulations could also add new conditions for previously ineligible borrowers that switch to PAYE repayment. For instance, capping loan forgiveness, requiring 25 years of payments for those with larger debt burdens, etc. We simply cannot be sure.

[Nomo]

It appears that EJW is still concerned that PSLF will be capped at some time in the future. They are asking for people to fill out a survey, and they seem to be working on building an interest/advocacy group.

article: http://abovethelaw.com/2015/01/public-s ... p-stop-it/

survey: http://storage.coremotivesmarketing.com ... bdbab0.htm

[Tanicius]

For my own sanity, I really wish people would not freak the fuck out every time there's any press release about PSLF in the news. Shit is seriously irrelevant until the House is actually voting on something. If we freak out every time someone on Capitol Hill whispers about getting rid of PSLF or curtailing it, we're going to die of exhaustion. People with (some) power on these issues talk about fucking over the beneficiaries every single day, whether it's SS, PSLF, subsidies, military base closures, enacting CISPA/SOPA, etc. Until there's actually a bill in a committee room being debated, we can't do anything other than raise awareness. And I promise you, we aren't winning a PR war on the subject of bailing out a bunch of hoity toity hippie law students who went 200k in debt to work for legal aid.

[bjsesq]

For my own sanity, I really wish people would not freak the fuck out every time there's any press release about PSLF in the news. Shit is seriously irrelevant until the House is actually voting on something. If we freak out every time someone on Capitol Hill whispers about getting rid of PSLF or curtailing it, we're going to die of exhaustion. People with (some) power on these issues talk about fucking over the beneficiaries every single day, whether it's SS, PSLF, subsidies, military base closures, enacting CISPA/SOPA, etc. Until there's actually a bill in a committee room being debated, we can't do anything other than raise awareness. And I promise you, we aren't winning a PR war on the subject of bailing out a bunch of hoity toity hippie law students who went 200k in debt to work for legal aid.

Dude's last post was links and he wasn't freaking out. Also: legal aid workers are hoity toity?

[Tanicius]

Dude's last post was links and he wasn't freaking out. Also: legal aid workers are hoity toity?

No I know -- I'm more responding to the general tendency of this thread to get bumped whenever PSLF pops up in a news article. ATL brought up EJW's perspective just yesterday, I think. I mean, I want EJW to do what it's doing and continue raising awareness, but the fear-mongering is a separate issue.

(And I know legal aid workers aren't hoity toity. But there are a ton of Americans who would straight up laugh with glee if they heard how much debt we have taken on for jobs meant to help people.)

[bjsesq]

Dude's last post was links and he wasn't freaking out. Also: legal aid workers are hoity toity?

No I know -- I'm more responding to the general tendency of this thread to get bumped whenever PSLF pops up in a news article. ATL brought up EJW's perspective just yesterday, I think. I mean, I want EJW to do what it's doing and continue raising awareness, but the fear-mongering is a separate issue.

(And I know legal aid workers aren't hoity toity. But there are a ton of Americans who would straight up laugh with glee if they heard how much debt we have taken on for jobs meant to help people.)

Those americans are nihilists, donny. They're nothing to be afraid of.

[Skool]

In terms of advocacy, if you don't mobilize until there's an actual bill in committee or on the floor, you're pretty late to the party.

I wouldn't call these every six month flare ups of discussion freaking out. They're an important part of keeping people informed about what's being discussed and preparing people to mobilize when the day of reckoning does finally come.

Mad props to EJW for stepping up to organize people and data. Organizing lawyers/law students has to be like herding the most unreasonable and stubborn of all cats.

[Nomo]

Another article discussing PSLF and the potential forgiveness cap: http://www.nytimes.com/2015/01/25/upsho ... 0002&abg=0

Not posting in an attempt to tell everyone that the sky is falling (though I do think we are going to end up with a cap in the next 5 years). I think this is worth noting because its a rare piece in a major publication that explains what IBR/PAYE/PSLF are, how they work, how many people are using them, and what the Obama administration proposed last year.

[renzal]

Are any of you willing to speculate what might become of LRAPs if this cap were to be put in place? Would nothing change, and would schools just expect students to make up the difference? Or do you think some might allocate more of their own funds to PI-bound grads? Or - gasp - might some actually think about decreasing tuition? (Jk.) I'm especially curious about Georgetown's program. Obviously it's too soon to know if this will get serious traction and exactly what it will mean if it does, but for 0Ls like me who are set on PI the mere possibility of schools + the govt no longer footing all/much of the bill is enough to make me reconsider law school altogether, at least until I'm more certain that in 3 years time these benefits will still exist.

[twenty]

The vast majority (all?) of LRAP programs are contingent upon availability of funds. I have no doubt that card gets played in the event of a cap like the one in the budget proposal. Legacy non-PSLF programs are far less generous, and usually cap at unreasonably low dollar amounts.

Relying on PSLF is high risk-high reward. Having the opportunity to go to a top law school you barely squeaked into for what ultimately amounts to "free" (since your PAYE/IBR payments probably won't even come to the three years of COA loans) is pretty great when you factor in all the benefits that leads to. If PSLF actually stays around for 13 years (or potentially longer, if you're not going to be in the same public interest job for ten years straight), you're doing pretty well. Alternatively, if PSLF doesn't stick around for 13+ years in its present form, you're fairly fucked. At the very least, you have to count on an additional 10 years of payments to get the extra loan forgiveness above the 57k cap or whatever.

[Skool]

Welp. That was the best and most terrifying post I've read on this forum in a while.

Still, I wonder if your post under-considers the possibility of future PSLF changes allowing current students or graduates enrolled in the program to remain under the old terms.

Sort of like how the Republicans are trying to repeal Obamacare by shooting a hole (using litigation) in the Federal government's ability to subsidize premiums on plans purchased outside of state exchanges. Even they are wary of political blow back from people who've already started to depend on the program.

Obviously, like you said, it's a big risk. But this seems like a plausible middle-path that moots speculation on what happens if they cap.

[renzal]

Thanks for chiming in Twenty, you seem to be the LRAP expert round these parts.

Alternatively, if PSLF doesn't stick around for 13+ years in its present form, you're fairly fucked. At the very least, you have to count on an additional 10 years of payments to get the extra loan forgiveness.

That is truly terrifying.

On the bright side, Skool, from what I've been reading the speculation is that people already in the program will be grandfathered in should anything change.

Edit:

According to a U.S. Department of Education spokesperson, current borrowers will not be subject to the proposed $57,500 cap on Public Service Loan Forgiveness. This cap will only apply to new borrowers after July 1, 2015 (if legislation mirrors the proposal).

Source: http://educatedrisk.org/analysis/ed-fur ... paye-terms

[Maple90]

What is the status of PSLF for 1L’s beginning in the 2015-2016 academic year?

If the 2015 budget proposal does not pass with the PSLF cap intact, will 1L’s beginning school in the Fall of 2015 likely be grandfathered in as well, that is if a similar proposal is brought up in years to come?

Also, by grandfathered in, does this only apply to those loans already taken out, or will it also include loans necessary to complete ones degree?

[sd5289]

This is the second academic year that this type of proposal has made the rounds, and there seems to be pretty vast agreement that anyone who is already on board with PSLF will be grandfathered in. The Republicans may be wanting to torpedo anything and everything Obama touches, but they're not fiscally suicidal (well, not al of them). It's not in their interests to fuck the people over who are already using/dependent on IBR/PAYE and PSLF. Having a bunch of PI lawyers default on their federally financed student loans would be counter-productive.

However, for 0Ls who are considering law school and a career in PI, I am begging you to fight for full ride schollies and very little to no cost of living debt. I did this prior to the PSLF "cap" talk started, and I'm very happy I did so. It's nice to know that I'm not staring down the barrel of a potential financial bomb.

[sd5289]

What is the status of PSLF for 1L’s beginning in the 2015-2016 academic year?

If the 2015 budget proposal does not pass with the PSLF cap intact, will 1L’s beginning school in the Fall of 2015 likely be grandfathered in as well, that is if a similar proposal is brought up in years to come?

Also, by grandfathered in, does this only apply to those loans already taken out, or will it also include loans necessary to complete ones degree?

From the site that twenty linked to:

UPDATE: Hat Tip to @Cooper's Comment. According to the 2015 Budget Proposal (page S-13) [PDF], borrowers that have loans disbursed prior to July 1, 2015 will have the old PAYE terms for new loans disbursed after July 1, 2015 as well. Here is the actual text:

Students who borrowed their first loans prior to July 1, 2015, would continue to be able to select among the existing repayment plans (for plans for which they now qualify and for loans originated through their current course of study), in addition to the modified PAYE.

So, if a freshman gets student loans for the 2014-15 academic year, they will have the option of getting the current PAYE terms and conditions for ALL loans during his or her "course of study", even loans after July 1, 2015. It is unclear what "course of study" means, but it presumably includes all loans to finish a program (undergrad or graduate). It may also mean additional programs. For example a 2014-15 freshman may be able to get current PAYE terms for loans disbursed way after 2015 for graduate school.

[bearsfan23]

This is the second academic year that this type of proposal has made the rounds, and there seems to be pretty vast agreement that anyone who is already on board with PSLF will be grandfathered in. The Republicans may be wanting to torpedo anything and everything Obama touches, but they're not fiscally suicidal (well, not al of them). It's not in their interests to fuck the people over who are already using/dependent on IBR/PAYE and PSLF. Having a bunch of PI lawyers default on their federally financed student loans would be counter-productive.

However, for 0Ls who are considering law school and a career in PI, I am begging you to fight for full ride schollies and very little to no cost of living debt. I did this prior to the PSLF "cap" talk started, and I'm very happy I did so. It's nice to know that I'm not staring down the barrel of a potential financial bomb.

This is bad advice. A full ride scholly at a TTT just means you've probably wasted 3 years of your life. On the other hand, schools like HYS will almost certainly adjust their LRAPs for whatever ends up passing. For god's sake at least wait until any revisions actually pass. This thread is about 20 pages of doomsday speculation, when in reality the only thing that has happened so far is an expansion of PAYE and PSLF.

It's definitely something to keep an eye on, but making a decision regarding the rest of your life based on a hypothetical budget is idiotic.

[twenty]

This is the second academic year that this type of proposal has made the rounds, and there seems to be pretty vast agreement that anyone who is already on board with PSLF will be grandfathered in. The Republicans may be wanting to torpedo anything and everything Obama touches, but they're not fiscally suicidal (well, not al of them). It's not in their interests to fuck the people over who are already using/dependent on IBR/PAYE and PSLF. Having a bunch of PI lawyers default on their federally financed student loans would be counter-productive.

However, for 0Ls who are considering law school and a career in PI, I am begging you to fight for full ride schollies and very little to no cost of living debt. I did this prior to the PSLF "cap" talk started, and I'm very happy I did so. It's nice to know that I'm not staring down the barrel of a potential financial bomb.

This is bad advice. A full ride scholly at a TTT just means you've probably wasted 3 years of your life. On the other hand, schools like HYS will almost certainly adjust their LRAPs for whatever ends up passing. For god's sake at least wait until any revisions actually pass. This thread is about 20 pages of doomsday speculation, when in reality the only thing that has happened so far is an expansion of PAYE and PSLF.

It's definitely something to keep an eye on, but making a decision regarding the rest of your life based on a hypothetical budget is idiotic.

You're being deliberately dense here. No one is advocating for a full scholarship at a TTT which probably would have stipulations attached anyway. Furthermore, HYS have terrible LRAPs, and anyone that goes for the LRAP is stupid. This is particularly relevant where an HYS admit would almost certainly have a full ride to a T14. I don't know how HYS would adjust their LRAP programs considering that they're already not contingent upon IBR. PSLF has expanded? What?

[Nomo]

HYS LRAP's aren't tied to IBR/PSLF. But pretty much every other T14 LRAP is. The schools are barely paying anything for these LRAP's because then nature of IBR makes the payments very low to begin with. I would be shocked if any LRAP tied to IBR is paying an average of more than $3,500 per year per student enrolled in the program.

But Repayment at T14 schools can be as much as $3,500/PER MONTH. The schools can't afford to pay out that kind of cash. And they won't.

[sd5289]

This is the second academic year that this type of proposal has made the rounds, and there seems to be pretty vast agreement that anyone who is already on board with PSLF will be grandfathered in. The Republicans may be wanting to torpedo anything and everything Obama touches, but they're not fiscally suicidal (well, not al of them). It's not in their interests to fuck the people over who are already using/dependent on IBR/PAYE and PSLF. Having a bunch of PI lawyers default on their federally financed student loans would be counter-productive.

However, for 0Ls who are considering law school and a career in PI, I am begging you to fight for full ride schollies and very little to no cost of living debt. I did this prior to the PSLF "cap" talk started, and I'm very happy I did so. It's nice to know that I'm not staring down the barrel of a potential financial bomb.

This is bad advice. A full ride scholly at a TTT just means you've probably wasted 3 years of your life. On the other hand, schools like HYS will almost certainly adjust their LRAPs for whatever ends up passing. For god's sake at least wait until any revisions actually pass. This thread is about 20 pages of doomsday speculation, when in reality the only thing that has happened so far is an expansion of PAYE and PSLF.

It's definitely something to keep an eye on, but making a decision regarding the rest of your life based on a hypothetical budget is idiotic.

You're being deliberately dense here. No one is advocating for a full scholarship at a TTT which probably would have stipulations attached anyway. Furthermore, HYS have terrible LRAPs, and anyone that goes for the LRAP is stupid. This is particularly relevant where an HYS admit would almost certainly have a full ride to a T14. I don't know how HYS would adjust their LRAP programs considering that they're already not contingent upon IBR. PSLF has expanded? What?

Yeah...at what point in my post did I advocate taking a full ride at a TTT? And +1 to the stipulations. 0Ls, do not take scholarships with stipulations. They are bullshit, and that school is likely trying to screw you. There's no greater racket than the stip schollie that you take and then lose after your grades aren't in the "top 40%" of the class or whatever. These schools are banking on students who are rising 2Ls when they lose their schollies to believe they're already too far in to stop or back out even though they've lost their money.

There are a number of factors that should go into any 0L's decision-making process, and I'm not so presumptuous as to pretend I know what these factors are for today's 0Ls (the application and bargaining processes are already radically different in the three short years it's been since I was in their position).

However, for those even considering doing PI post-grad, there is simply no reason to not gun for a full ride and make that a priority in your decision-making process. Even if you eventually end up as, say, an AUSA at a USAO in a District with a high cost of living, you will not make enough to pay off a high amount of student debt if PSLF bites the dust (or is "capped" at some arbitrary amount). Same story with schools' LRAP. Why put yourself in a position where you're dependent on programs that are largely outside of your control when you KNOW that if those programs didn't exist, you're screwed. You can call it a hypothetical budget all you want. The rest of us will continue to call it minimizing your risk (especially since we're discussing something that is far more in your control as a 0L...scholarship negotiation and deciding whether to matriculate or not).

[FlanAl]

HYS LRAP's aren't tied to IBR/PSLF. But pretty much every other T14 LRAP is. The schools are barely paying anything for these LRAP's because then nature of IBR makes the payments very low to begin with. I would be shocked if any LRAP tied to IBR is paying an average of more than $3,500 per year per student enrolled in the program.

But Repayment at T14 schools can be as much as $3,500/PER MONTH. The schools can't afford to pay out that kind of cash. And they won't.

Myself and another guy at the non-profit I work for are both on LRAPs not tied to IBR. My payments aren't $3,500 but they are close to 3 grand and my school pays for close to all of it. The other guy's school does the same. These schools have millions set aside specifically for their LRAP programs and very few students who take advantage of them. As far as I can tell they can afford to pay that kind of cash and do. I think that there are plusses and minuses to programs tied to IBR but the TLS mantra that if your LRAP isn't tied to IBR it sucks isn't exactly true.