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

[LSL]

This appears to apply retroactively.

PEOPLE (PSLFers) WORRIED ABOUT RETROACTIVITY, LOOK AT THIS NOW. It blows for people taking out their first loan after July 1, 2015, but before, I THINK we're grandfathered in. Look here at the Dept of Ed's Budget Proposal Explanation:

On page 14: "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, based on that, I think if you've already borrowed, you're still safe to have more than $57,500 forgiven under PSLF. This is the relevant language, I'm pretty sure. For those PLSFers who borrowed before July 1st, 2015, I think we're okay, but everyone who wanted to take advantage of the program after that (possibly people starting not next fall, but the fall after who've never taken out loans) appear to be fucked. FWIW (not much) the reddit threadon this discusses the July 1st date a bit too.

[patogordo]

i'm not sure this is a real budget. i don't see anything about repealing obamacare.

[californiauser]

i'm not sure this is a real budget. i don't see anything about repealing obamacare.

this is obama's budget which almost certainly will not make it through congress

[hdunlop]

This appears to apply retroactively.

PEOPLE (PSLFers) WORRIED ABOUT RETROACTIVITY, LOOK AT THIS NOW. It blows for people taking out their first loan after July 1, 2015, but before, I THINK we're grandfathered in. Look here at the Dept of Ed's Budget Proposal Explanation:

On page 14: "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, based on that, I think if you've already borrowed, you're still safe to have more than $57,500 forgiven under PSLF. This is the relevant language, I'm pretty sure. For those PLSFers who borrowed before July 1st, 2015, I think we're okay, but everyone who wanted to take advantage of the program after that (possibly people starting not next fall, but the fall after who've never taken out loans) appear to be fucked. FWIW (not much) the reddit threadon this discusses the July 1st date a bit too.

I'm just a lowly 0L so take this as whatever, but to me, the context is key. The sentence before it makes clear it's talking about PAYE vs other income-driven repayment plans. I'm pretty sure it's saying if you're on ICR or IBR or god knows what else you can keep doing it but otherwise going forward its PAYE only. PSLF would be its own thing (again context, note that the proposal to cap it is under the header ADDITIONAL changes to PAYE).

[vball1]

More on Georgetown-- Especially the second video. Oh you can pay more on the massive loans you owe?
Don't do that.

http://www.washingtonpost.com/blogs/won ... nts-bills/

Anyway, Congress may be reeling in the huge moral hazard it created. At Georgetown's admitted students weekend last year they pushed their LRAP program hard and were ultimately super stingy with scholarships. They gave the example at the financial aid meeting of moving to another country to sell ice cream on a beach, emphasizing how you can take out a Million Dollars and your payments will still be the same. There point was don't worry about the money, free money for everyone come to Georgetown with no aid because our LRAP + PSLF/IBR/PAYE will take care of you. Smelled fishy so I ran for the hills. When you sign those loans its your name on it, really have to think long and hard if you trust the government to keep a clearly unsustainable program. Also LOL at the first video suggesting young lawyers stopping congress.

TLDR; Schools exploit tax payers to avoid tightening their belt. All people relying on this program to finance a high priced school instead of instead of attending a strong regional with a large scholarship/free are doing so at a risk, one they must be aware of at the time despite PLSF/IBR/PAYE.

[LSL]

This appears to apply retroactively.

PEOPLE (PSLFers) WORRIED ABOUT RETROACTIVITY, LOOK AT THIS NOW. It blows for people taking out their first loan after July 1, 2015, but before, I THINK we're grandfathered in. Look here at the Dept of Ed's Budget Proposal Explanation:

On page 14: "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, based on that, I think if you've already borrowed, you're still safe to have more than $57,500 forgiven under PSLF. This is the relevant language, I'm pretty sure. For those PLSFers who borrowed before July 1st, 2015, I think we're okay, but everyone who wanted to take advantage of the program after that (possibly people starting not next fall, but the fall after who've never taken out loans) appear to be fucked. FWIW (not much) the reddit threadon this discusses the July 1st date a bit too.

I'm just a lowly 0L so take this as whatever, but to me, the context is key. The sentence before it makes clear it's talking about PAYE vs other income-driven repayment plans. I'm pretty sure it's saying if you're on ICR or IBR or god knows what else you can keep doing it but otherwise going forward its PAYE only. PSLF would be its own thing (again context, note that the proposal to cap it is under the header ADDITIONAL changes to PAYE).

A couple lines down (in the same section) they reference the PSLF cap. It's under the PAYE header, but they're discussing PSLF as well. Although, if PSLF is NOT considered an repayment plan referenced in the given context because it's not "income-driven" (which is a fair point) then yes, we could still be fucked. That's the pertinent part/question though (does that apply to pre-July 1st, 2015 PSLFers or not?)

[bananatopia]

deleted

[A. Nony Mouse]

This appears to apply retroactively.

PEOPLE (PSLFers) WORRIED ABOUT RETROACTIVITY, LOOK AT THIS NOW. It blows for people taking out their first loan after July 1, 2015, but before, I THINK we're grandfathered in. Look here at the Dept of Ed's Budget Proposal Explanation:

On page 14: "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, based on that, I think if you've already borrowed, you're still safe to have more than $57,500 forgiven under PSLF. This is the relevant language, I'm pretty sure. For those PLSFers who borrowed before July 1st, 2015, I think we're okay, but everyone who wanted to take advantage of the program after that (possibly people starting not next fall, but the fall after who've never taken out loans) appear to be fucked. FWIW (not much) the reddit threadon this discusses the July 1st date a bit too.

I wish I agreed with you (and I want this to be true) but as twenty has pointed out, PSLF isn't a repayment plan. It's a forgiveness plan that requires you to be on a repayment plan. You're not on PSLF until you've made 120 payments, when you become eligible for forgiveness.

Also, I love the civic mindedness of not caring if lawyers can go into the public sector. I get that lawyers with debt aren't the same as the poverty level family (and that's a good reminder), but there's a need for low-cost legal services, and debt makes it hard for people to offer those services.

[hdunlop]

Yeah exactly. My thought is PSLF isn't an income driven repayment plan, it's a forgiveness plan that requires you to be in an income driven repayment plan (see here, where it lists the three income driven repayment plans as qualifying plans for participation in PSLF). I'm trying to run this to ground with a friend.

That Georgetown anecdote above is really sickening.

[bjsesq]

I placed a call to my senator's office (he is on some education committees.) I will be speaking with his LA later this afternoon and hopefully they can provide some insight (he is a dem, so that should limit the NOBAMA boogeyman shit).

[vball1]

Not that this behavior is limited to Georgetown or to pick on them, I am sure other schools have similar practices. I read a lot of about there program, because I was really interested in attending. One thing that stuck out is there LRAP is funded by current students tuition (usually paid for by federal loans). Ponzi scheme alarm bells went off immediately.

[hdunlop]

Now the government is apparently saying that they won't be extending this offer to any more workers.

Rather, it's saying that it's capping the value of the offer -- quantifying the maximum size of the bonus -- most likely for all workers. I'm getting mixed interpretations from Hill folks too, so we'll see where ti comes out.

The important thing to note is it doesn't actually matter that much, this is just a proposal and it's going nowhere. What DOES matter is that this is now a target thanks to Georgetown and to a lesser extent doctors benefiting from PSLF and everyone should go into the program eyes wide open.

[Nomo]

I placed a call to my senator's office (he is on some education committees.) I will be speaking with his LA later this afternoon and hopefully they can provide some insight (he is a dem, so that should limit the NOBAMA boogeyman shit).

Thank you. This is something we should all be doing.

[Dingo Starr]

I placed a call to my senator's office (he is on some education committees.) I will be speaking with his LA later this afternoon and hopefully they can provide some insight (he is a dem, so that should limit the NOBAMA boogeyman shit).

Thank you. Glad someone took some initiative.

[hausmaus]

I placed a call to my senator's office (he is on some education committees.) I will be speaking with his LA later this afternoon and hopefully they can provide some insight (he is a dem, so that should limit the NOBAMA boogeyman shit).

Thank you. This is something we should all be doing.

My Congressperson's office is trying to find an answer for me. We can compare notes.

[Tiago Splitter]

One thing that stuck out is there LRAP is funded by current students tuition (usually paid for by federal loans). Ponzi scheme alarm bells went off immediately.

Is that really different from other schools? It seems like you can always pretend that money comes from an endowment or some other source, but it's all the same scam.

[Winter is Coming]

Not that this behavior is limited to Georgetown or to pick on them, I am sure other schools have similar practices. I read a lot of about there program, because I was really interested in attending. One thing that stuck out is there LRAP is funded by current students tuition. Ponzi scheme alarm bells went off immediately.

I’m in that position now, trying to decide between Georgetown and some other lower T14s vs. good money at some strong regionals. The Georgetown LRAP is presented so oddly to prospective students, its almost like they tell you “can you believe the government is so stupid that they let us do this?” like its going to be set in stone forever.

It makes even a Cornell vs. GTown decision a lot easier if your basing it using the LRAPs as one of the deciding factors. Cornells PLIPP will cover your (a portion) of your payments under the standard plan so you don’t have to rely on PSLF existing in ten years to completely pay off your loans/have them forgiven. It also allows you a more manageable debt if you decide to leave PI after less than 10 years. With Georgetown you could work 9 years in DA’s office and have something happen and wind up with absolutely no benefit whatsoever (you’d actually probably be in an even worse hole if you took out significant loans because of the negative amortization from paying using PAYE.)

[LSL]

This appears to apply retroactively.

PEOPLE (PSLFers) WORRIED ABOUT RETROACTIVITY, LOOK AT THIS NOW. It blows for people taking out their first loan after July 1, 2015, but before, I THINK we're grandfathered in. Look here at the Dept of Ed's Budget Proposal Explanation:

On page 14: "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, based on that, I think if you've already borrowed, you're still safe to have more than $57,500 forgiven under PSLF. This is the relevant language, I'm pretty sure. For those PLSFers who borrowed before July 1st, 2015, I think we're okay, but everyone who wanted to take advantage of the program after that (possibly people starting not next fall, but the fall after who've never taken out loans) appear to be fucked. FWIW (not much) the reddit threadon this discusses the July 1st date a bit too.

I wish I agreed with you (and I want this to be true) but as twenty has pointed out, PSLF isn't a repayment plan. It's a forgiveness plan that requires you to be on a repayment plan. You're not on PSLF until you've made 120 payments, when you become eligible for forgiveness.

Also, I love the civic mindedness of not caring if lawyers can go into the public sector. I get that lawyers with debt aren't the same as the poverty level family (and that's a good reminder), but there's a need for low-cost legal services, and debt makes it hard for people to offer those services.

Thanks, Nony. Honestly, I'm rethinking my stance very much with this. I thought it might fall into a repayment plan since it means you don't have to repay the remaining balance on the loans. But, that it's considered a forgiveness loan makes more sense. Back on the "this is fucking awful for me as well" train until proven otherwise.

Will be calling my senators today as well once I'm done with my unpaid government internship work that now feels extra exploitative.

[TigerDude]

Let's be clear that any form of welfare (and yes that's what the program is) can be eliminated at the drop of a hat. Loan forgiveness is another market-breaker that moves around costs from where they should be. If government/non-profit jobs aren't competitive on their own then the market should respond to that.

If it doesn't go away now, you can be that the seed has been planted. Counting on the government to pay your debts is probably a bad plan.

[nouseforaname123]

This appears to apply retroactively.

PEOPLE (PSLFers) WORRIED ABOUT RETROACTIVITY, LOOK AT THIS NOW. It blows for people taking out their first loan after July 1, 2015, but before, I THINK we're grandfathered in. Look here at the Dept of Ed's Budget Proposal Explanation:

On page 14: "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, based on that, I think if you've already borrowed, you're still safe to have more than $57,500 forgiven under PSLF. This is the relevant language, I'm pretty sure. For those PLSFers who borrowed before July 1st, 2015, I think we're okay, but everyone who wanted to take advantage of the program after that (possibly people starting not next fall, but the fall after who've never taken out loans) appear to be fucked. FWIW (not much) the reddit threadon this discusses the July 1st date a bit too.

I wish I agreed with you (and I want this to be true) but as twenty has pointed out, PSLF isn't a repayment plan. It's a forgiveness plan that requires you to be on a repayment plan. You're not on PSLF until you've made 120 payments, when you become eligible for forgiveness.

Also, I love the civic mindedness of not caring if lawyers can go into the public sector. I get that lawyers with debt aren't the same as the poverty level family (and that's a good reminder), but there's a need for low-cost legal services, and debt makes it hard for people to offer those services.

So services will be provided by people with lower debt levels. I get that that means privileged people or people with less prestigious law degrees, but I don't think you're going to see low-paying lawyer jobs go unfilled. I'm also not sure that there will be too much of a drop off in quality of services just because what would have been a heavily indebted Harvard grad is now a less indebted NYU grad.

[Tanicius]

If government/non-profit jobs aren't competitive on their own then the market should respond to that.

Since time immemorial, the market has not responded to this problem. These jobs have always been too low-paying and have always had too small a number of seats in the first place. There is a high demand for these services, but it comes from people who can't pay a dime for the service. A demand from people who don't have money is effectively the same thing as no demand at all, economics-wise.

[Cal Trask]

Let's be clear that any form of welfare (and yes that's what the program is) can be eliminated at the drop of a hat. Loan forgiveness is another market-breaker that moves around costs from where they should be. If government/non-profit jobs aren't competitive on their own then the market should respond to that.

If it doesn't go away now, you can be that the seed has been planted. Counting on the government to pay your debts is probably a bad plan.

Doesn't it seem a bit disingenuous to refer to government/PI jobs as though they're influenced by the same market pressures as private practice? These offices aren't paying less for the hell of it, they're either surviving on grants (PI) or have pre-determined budgets. I'm sure many of these offices would pay their attorneys more if it were possible to do so.

[thechancellor]

Now the government is apparently saying that they won't be extending this offer to any more workers.

Rather, it's saying that it's capping the value of the offer -- quantifying the maximum size of the bonus -- most likely for all workers. I'm getting mixed interpretations from Hill folks too, so we'll see where ti comes out.

The important thing to note is it doesn't actually matter that much, this is just a proposal and it's going nowhere. What DOES matter is that this is now a target thanks to Georgetown and to a lesser extent doctors benefiting from PSLF and everyone should go into the program eyes wide open.

Interested in hearing how people's Hill calls go (my guess is going to be we're gonna get a lot of variance in interpretations, but that's pretty standard for the Hill...) but agreed with this.

[LSL]

Let's be clear that any form of welfare (and yes that's what the program is) can be eliminated at the drop of a hat. Loan forgiveness is another market-breaker that moves around costs from where they should be. If government/non-profit jobs aren't competitive on their own then the market should respond to that.

If it doesn't go away now, you can be that the seed has been planted. Counting on the government to pay your debts is probably a bad plan.

Twenty, could you put in the OP that egregious bootstrapper sympathizers will be the first to go in the revolution? We should give fair notice.

[Cal Trask]

Let's be clear that any form of welfare (and yes that's what the program is) can be eliminated at the drop of a hat. Loan forgiveness is another market-breaker that moves around costs from where they should be. If government/non-profit jobs aren't competitive on their own then the market should respond to that.

If it doesn't go away now, you can be that the seed has been planted. Counting on the government to pay your debts is probably a bad plan.

Twenty, could you put in the OP that egregious bootstrapper sympathizers will be the first to go in the revolution? We should give fair notice.

I'm just confused by the statement of "the market will take care of it" in this context.