LRAP's Compared Forum

[aspasia]

[More editing for incorrectness; I don't want to accidentally propagate bad info.]

[doyleoil]

Regarding NYU's penalty for private employment in the second summer, I believe they expect you to contribute any amount over 15,000, not simply the total amount. Thus, if you make 30,000, they would expect you to take out 15,000 less in loans for your 3L year. I don't have the numbers in front of me, but I believe these figures are fairly accurate.

I may have misunderstood their system for that, and I'm sorry if I did. Still, though, the NYU woman was very clear that it would benefit you to NOT do private sector employment, and that's how you get the most LRAP coverage... if you only have to contribute the excess, which most people could easily do, why would that negatively affect you? (I don't mean to argue, I'd genuinely like to understand their system).

it's not like it hurts you, per se - it's just that if you wanted to use that money for something else (rather than to keep your loans down during the next school year), you couldn't do that and still get nyu's lrap to cover the extra 15k in loans you took out - why might someone be stupid enough not to use that excess income to pay down loans in the first place? god only knows why people do what they do*, but nyu will call you on your summer earnings - not sure if columbia or other schools will do that

*e.g. this person (don't be like her..haha): --LinkRemoved--

[YCrevolution]

..

[aspasia]

Regarding NYU's penalty for private employment in the second summer, I believe they expect you to contribute any amount over 15,000, not simply the total amount. Thus, if you make 30,000, they would expect you to take out 15,000 less in loans for your 3L year. I don't have the numbers in front of me, but I believe these figures are fairly accurate.

I may have misunderstood their system for that, and I'm sorry if I did. Still, though, the NYU woman was very clear that it would benefit you to NOT do private sector employment, and that's how you get the most LRAP coverage... if you only have to contribute the excess, which most people could easily do, why would that negatively affect you? (I don't mean to argue, I'd genuinely like to understand their system).

it's not like it hurts you, per se - it's just that if you wanted to use that money for something else (rather than to keep your loans down during the next school year), you couldn't do that and still get nyu's lrap to cover the extra 15k in loans you took out - why might someone be stupid enough not to use that excess income to pay down loans in the first place? god only knows why people do what they do*, but nyu will call you on your summer earnings - not sure if columbia or other schools will do that

Sorry, I edited after you quoted. I may call the financial aid office to clarify, because the woman was just so adamant that it would actually be detrimental to take that firm job.. I'll let you know what they say!

[FelaForever]

So, quick question - does NYU's not cover academic jobs? Is it only government or 501(c)3s?? On the website I see things about private/for-profit jobs and self-employment being considered on a case-by-case basis, but nothing whatsoever about academic jobs. Does anyone know?

[sbalive]

So, quick question - does NYU's not cover academic jobs? Is it only government or 501(c)3s?? On the website I see things about private/for-profit jobs and self-employment being considered on a case-by-case basis, but nothing whatsoever about academic jobs. Does anyone know?

I believe non-profit universities (private and public) are generally 501(c)3s. But, realistically outside of research fellowships and maybe a VAP at the low end of the scale, the salary would exceed the limits, so any benefit would only apply at the beginning of an academic career.

[rlm33]

If you take a big law offer and then change your mind and decide to go into public interest a year or two later, are you still eligible for LRAP for the remaining portion of your loans? Is that wishful thinking? I'm mostly concerned with NYU.

[TrampsLikeU$]

If you take a big law offer and then change your mind and decide to go into public interest a year or two later, are you still eligible for LRAP for the remaining portion of your loans? Is that wishful thinking? I'm mostly concerned with NYU.

I think at least in a few programs I've looked at (GULC, UVA) you have to enter non-profit within 2 years of graduation. I'm not sure if that's the case for NYU

[dueprocess14]

bump! it's coming in very handy these days...

[bananas131]

Wow, I never noticed that 100k cap on Boalt's LRAP until now. That changes a lot for me considering I'd be looking at, at least, around $175k in loans Scholarship offers at T25s are looking a lot better now...

[Skadden Stairs]

deposit deadlines are looming in the T10...

[Pumpkin]

can i ask a question that at the surface seems ludicrous? in looking at Harvard's LIPP program, the amount you pay per month is determined solely by your income, NOT how much debt you have. And you are allowed to keep some assets protected. So if you are set on staying enrolled in the LIPP program for 10 years, what would be the incentive to try to pay off as much debt as possible, if you pay the same per month whether you owe 100k or 175k? and then at the end of the 10 year period, the debt is erased.

obviously, if you leave the LRAP/LIPP program, you want the minimal amount of debt but if you are in it for the longhaul, would it be better to build up separate savings, rather than lower your overall amount of debt???

[doyleoil]

can i ask a question that at the surface seems ludicrous? in looking at Harvard's LIPP program, the amount you pay per month is determined solely by your income, NOT how much debt you have. And you are allowed to keep some assets protected. So if you are set on staying enrolled in the LIPP program for 10 years, what would be the incentive to try to pay off as much debt as possible, if you pay the same per month whether you owe 100k or 175k? and then at the end of the 10 year period, the debt is erased.

obviously, if you leave the LRAP/LIPP program, you want the minimal amount of debt but if you are in it for the longhaul, would it be better to build up separate savings, rather than lower your overall amount of debt???

i certainly think so - remember also that this isn't back-end loan forgiveness, like the federal plan - you set up your payments on a 10-year schedule, and harvard is paying whatever you fall short of for the year (let's say you're making 60k and paying out whatever the hypo suggests you'd pay out - if you have 175k in debt, under a 10-year plan, you're looking at about 25k or so a year in loan payments - if you're only paying 6k with LIPP, harvard is covering that extra 19k) - so technically, you're "keeping up" on a normal 10-year repayment schedule, not piling up extra interest like you do under the federal ibr

[Pumpkin]

sorry, i don't understand. so you are saying i'm right in thinking it wouldn't matter if you had more debt or wrong?

at the Harvard ASW weekend, they gave us a flier that showed what you'd take home per month with different levels of debt and salaries. And once you were in LIPP, the take home didn't differ based on debt amount...

[doyleoil]

sorry, i don't understand. so you are saying i'm right in thinking it wouldn't matter if you had more debt or wrong?

at the Harvard ASW weekend, they gave us a flier that showed what you'd take home per month with different levels of debt and salaries. And once you were in LIPP, the take home didn't differ based on debt amount...

it absolutely doesn't matter for your take-home - the more debt the merrier, under LIPP (i mean, obviously i think there's still good reason to try to keep the amount as low as possible)

[Pumpkin]

right, it's just a question of whether i throw everything i possibly could at getting the debt as low as possible or accept that i'll be in the program and work on building up other assets so i can actually get married, have a car etc..

[doyleoil]

right, it's just a question of whether i throw everything i possibly could at getting the debt as low as possible or accept that i'll be in the program and work on building up other assets so i can actually get married, have a car etc..

you have to look at harvard's stipulations, but i'm almost sure you can't "overpay" like that, or, if you do, harvard will just cover less of your payment for the year - there's probably no penalty for "overpaying" in terms of the loan consolidation you do, but harvard is not going to cover more than the difference between your expected or actual contribution and your loan payment for the year

so, short answer, no you can't do that (i don't think ANY LRAP lets you do that)

[alleycat3]

I was at Michigan this week and I got some information on how assets will hurt you under their LRAP, in case anyone is interested:

Things that count as assets:

1.) Money, obviously (combined with spouse's and dependents' assets if applicable);
2.) House (only equity);
3.) 75% of retirement funds.

How assets are treated:

You get to keep anything under $15,000. Anything above that, you contribute 12% of your assets anually.

This made me feel better about U of M!

[Pumpkin]

in looking at NYU vs Harvard again, if you don't have other graduate debt, they turn out more or less the same right? NYU's is still better but not significantly. It's just that if you have graduate school debt, Harvard won't lessen the amount you owe right?

[abenn07]

This is an extraordinarily helpful thread, and I just wanted to add a couple of thoughts related to longer-term loan repayment, since many of us expect to stay in public interest for several years, if not for our entire careers. There are two important components: How often is the "ceiling" raised, and do the benefits change the longer you stay in the program?

I asked about these aspects of COAP at the YLS financial aid panel last week because the COAP PDF isn't terribly clear. Regarding the first question, the PDF says, "The contribution formula will be adjusted periodically taking various economic factors into account." I asked Pat Barnes to give us more specific information about how often and by how much the figures of $60,000 (for student income) and $40,000 (for spouse income) would be raised. Even when I pressed her, unfortunately, all she would say was, "Well, we just raised it to $60,000 last year." I interpret this to mean that the figures won't be changed any time soon--and that YLS has no intention of putting the COAP formula on a schedule to keep up with inflation and regular salary increases. So, assuming that your salary increases by 3 percent each year (typical for public interest, though for DOJ positions it is 7.5 percent) but the ceiling remains at $60,000, after a few years, you could be responsible for paying back more of your loans than you expected.

I also asked whether there was any benefit increase for graduates who stayed in the program the entire ten years. Pat first said no, but Asha Rangappa interjected that the terms of COAP do change after five years. (I think this information is online, but it was helpful to hear it explained.) During the first five years, COAP pays as if you are on a fifteen-year repayment plan; during the last five years, it pays as if you are on a five-year repayment plan. If you stay in COAP the whole time, this shouldn't matter either way, but if you leave COAP after five years, you'll actually be penalized--you'll still have two-thirds of your loans left to pay. Also, keep in mind that this interacts with the gradual increase of your salary over your career, so that COAP is designed to pay a *smaller* proportion in the first five years, when you are earning less (and have the biggest COAP eligibility), and a *greater* proportion in the last five years, when you are earning more (and have ever-decreasing COAP eligibility).

The only other loan repayment program I am familiar with is LIPP at HLS, and it is more helpful in both of these categories. (In the interest of full disclosure, I should point out that I have already chosen HLS over YLS.) The LIPP salary scale increases 3 percent annually, and the repayment formula actually becomes more generous over time, since there is a "longevity allowance": In your fifth year you get a $5,000 income credit (meaning your repayment contribution is calculated as if you make $5,000 less than you do); in your sixth year you get a $6,000 credit; and so on until you get a $10,000 credit during the tenth and last year of repayment.

I do think COAP is still overall the more generous program--unless you are married (or will get married while you are repaying your loans), which I am, but that difference was already nicely covered by aryncita and added to doyleoil's original post.

By the way, these links may be in here somewhere, but I'm getting most of the information about LIPP (and about salary increases) from http://www.law.harvard.edu/apps/sfs/cal ... lipp-calc/, and the COAP PDF is at http://www.law.yale.edu/documents/pdf/F ... _later.pdf.

[sbalive]

I'm learning more about the Columbia LRAP. One thing I've learned that might be added to the description is that academic jobs are covered. (While tenure-track positions are high-paying, this is helpful for research fellowships and visiting assistant professorships.)

[jh60405]

On the Berkeley 2012 thread they have an email from the Dean indicating that they are ammending the LRAP program there. The $100,000 cap will be gone, and people will get full benefits all the way up to $65,000, instead of the previous $58,000. I don't know if there will be any kind of a catch, but if there isn't then it would sound like Berkeley's LRAP has really become top notch.

[doyleoil]

On the Berkeley 2012 thread they have an email from the Dean indicating that they are ammending the LRAP program there. The $100,000 cap will be gone, and people will get full benefits all the way up to $65,000, instead of the previous $58,000. I don't know if there will be any kind of a catch, but if there isn't then it would sound like Berkeley's LRAP has really become top notch.

there is a catch - you have to enroll in the federal income-based repayment plan - this means that, under 65k in income, you're still contributing nothing - but berkeley is actually contributing less than they normally would (i'm guessing) because they're covering your payments under ibr (which are lower than if you've scheduled them normally on a 10-year repayment plan)

that's still not bad, IF you stay in qualifying employment for all 10 years, at the end of which the government forgives your remaining principal and interest (possibly subject to tax penalty, though)

something i learned about ibr (that is somewhat disturbing to me), relayed by dean z at michigan in a phone conversation, is that if you leave qualifying employment at ANY time under the federal 10-year ibr plan, your loans are re-amortized (? i think that's the right term), meaning all interest that has accumulated is folded into your principal, and you have ONLY until the end of the original 10 years to repay them

so, e.g., you do a p.i. job for 5 years under ibr, then after 5 years you want to switch to private sector employment - you have only 5 years to pay off any interest that has accumulated in the previous 5 years and any principal that remains (probably all the original principal, depending on how much you took out in loans)

THAT is a scary prospect, i have to say

edit: i should eventually update the original post to include the new berkeley information (but i think it should wait until the full details are available) - i also need to update to include sbalive's info about columbia and academic jobs

[alleycat3]

Doyle's right, there's a catch. But I'm almost positive that Berkeley isn't getting rid of the old program, so you can choose which program to enter.

[toaster2]

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