Understanding LRAP/IBR: CLS & NYU Forum

[mabes]

Hi, I know there's info/other threads out there on this but I'm struggling to understand what I've found. Can someone help me with objectively evaluating what CLS and NYU's LRAP really offers?

On the surface, it seems (and its MARKETED) that NYU's LRAP is fantastic and CLS's is average. CLS caps income at $50k for 100% coverage whereas at NYU its 80k for 100% coverage.

However, NYU's program seems to be inherently linked with IBR enrollment and CLS's is not (?? i think ??). CLS has a section that says their program jumps to 100% coverage up to 100k salary when the LRAP is combined with IBR. Is everyone eligible to do this? What are the drawbacks?

Also, i THINK it seems that with NYU's LRAP loans, membership MUST last 10 years for ANYTHING to be forgiven. If I leave the program after 8 years, I owe EVERYTHING back WITH interest? For CLS, after 3 years 33% is forgiven, after 4 67% is forgiven, and after 5 100% is forgiven on an annual basis? Is that right?

If I'm reading all this right, it seems CLS's LRAP when combined with IBR is far superior, because I have no restrictions about what type of work I can pursue after 3-5 years (assuming I'm willing to take on whatever remaining debt is left) and because the salary cap is quite high (relatively speaking) for salaries within the world of public service work. NYU's program seems superior only if I would be ineligible for IBR (I don't understand what makes one eligible or not for this).

I feel like there's something I'm not understanding, since NYU openly markets their program as one of (if not, the) best LRAP and because people generally cede this point in the NYU vs. CLS debate...

[twenty]

Yeah, except CLS' IBR cap that doesn't pay down the principal is 100k, not 50k. The 50k cap is a reflection of the pre-IBR LRAP. Which you can still do, but you end up paying a lot more for.

CLS' LRAP beats NYU's, but NYU's is still very good.

[mabes]

Yeah, except CLS' IBR cap that doesn't pay down the principal is 100k, not 50k. The 50k cap is a reflection of the pre-IBR LRAP. Which you can still do, but you end up paying a lot more for.

CLS' LRAP beats NYU's, but NYU's is still very good.

So why would anyone do an lrap without IBR? what's the drawback

[frasier]

Can someone please define IBR for me?

[twenty]

So why would anyone do an lrap without IBR? what's the drawback

The pro side is that non-IBR LRAP repays your loan on a ten year schedule. So if you work in public interest for five years, half your debt would be gone.

Drawback is it's super expensive to repay without PSLF, so schools try and make you pick up a big chunk of it when your salary increases.

[SamuelDanforth]

Also interested in this, so it would be great if anyone with experience in either program could chime in. CLS' program definitely seems better than its reputation would suggest, even if they peg you a bit more at the 50,000-80,000 range.

[crescentstars]

Thank you for posting about this. I'm also really curious about how all of this breaks down.

On a side/related note - what do you all think of the inherent reliability of LRAP that integrates with IBR/PSLF? I'm a bit worried about congressional/executive changes to these programs affecting if/how I can pay off the loans I'm about to take out, but I'm not sure if I'm overreacting? If it is a valid concern though, would that make Columbia's LRAP a better bet than NYU's, assuming you qualify?

Can someone please define IBR for me?

I'll take a stab at this -- I'm not 100% sure about how well I understand this, so someone might have to check me on it. I believe it stands for Income-Based Repayment for your federal loans. It's a type of federal loan repayment program that calculates your payments based on your income (duh?), which can benefit you if your salary is low (as it is for lots of PI folks). Schools that integrate their own LRAP with the IBR/PSLF are able to offer more help for student loan payments in that you can qualify for these programs with a slightly higher salary (??), as the school will help you with a percentage of your loan payments. But I think this is largely school-dependent and there's a lot of fine print - hence all the confusion here.

I'm looking for a lot of information at the link below as well, though I'm not being super thorough right now. Don't quote me as an expert on this!

https://studentaid.ed.gov/sa/repay-loan ... ome-driven

[mabes]

Thank you for posting about this. I'm also really curious about how all of this breaks down.

On a side/related note - what do you all think of the inherent reliability of LRAP that integrates with IBR/PSLF? I'm a bit worried about congressional/executive changes to these programs affecting if/how I can pay off the loans I'm about to take out, but I'm not sure if I'm overreacting? If it is a valid concern though, would that make Columbia's LRAP a better bet than NYU's, assuming you qualify?

Its hard to say. When I posed this to the Fin Aid office (of CLS) she said something along the lines of, all we can say is it varies family to family and what level of risk you are comfortable with. I understand her predicament because they literally can't vouch for what will happen in the future. On the one hand, I feel like it seems kind of paranoid to worry about the program suddenly disappearing. But yes, in theory, it can happen. In this political climate, where student loan debt is a buzzword issue on both sides of the aisle, I can't imagine a politically viable attempt to repeal one of the few programs related to student loan debt forgiveness. That being said, 10 years is a long time and who knows what kind of budget shenanigans will take place.

To answer your second question, I'm not sure it makes Columbia's a "better bet," but it does mean that Columbia allows you to choose between LRAP and LRAP/IBR while NYU puts everyone in LRAP/IBR unless you have a job that doesn't qualify for PSLF. So it increases your amount of choice.

^But that being said, its crucial to remember that NYU has their "buyout" clause thingy. The way she explained it to me, if I'm enrolled in the NYU LRAP/IBR program, and after X number of years I switch into a job that no longer qualifies for PSLF or surpasses the income cap or something, NYU will submit a one-time payment, or "buyout," that would set you on track with the solo-LRAP program. I know thats kind of confusing, but the idea is that with IBR you wouldn't have actually paid down your debt over those X years, so instead of leaving you fucked, NYU will pay the amount that you would've paid over X number of years that you would've been enrolled in standard LRAP.

however, she said they take certain things into account like your salary over those years etc etc etc, so I doubt they allow the payout to be huge.

Let me know if this makes sense/if you see any places I'm misinterpreting

[crescentstars]

Its hard to say. When I posed this to the Fin Aid office (of CLS) she said something along the lines of, all we can say is it varies family to family and what level of risk you are comfortable with. I understand her predicament because they literally can't vouch for what will happen in the future. On the one hand, I feel like it seems kind of paranoid to worry about the program suddenly disappearing. But yes, in theory, it can happen. In this political climate, where student loan debt is a buzzword issue on both sides of the aisle, I can't imagine a politically viable attempt to repeal one of the few programs related to student loan debt forgiveness. That being said, 10 years is a long time and who knows what kind of budget shenanigans will take place.

To answer your second question, I'm not sure it makes Columbia's a "better bet," but it does mean that Columbia allows you to choose between LRAP and LRAP/IBR while NYU puts everyone in LRAP/IBR unless you have a job that doesn't qualify for PSLF. So it increases your amount of choice.

^But that being said, its crucial to remember that NYU has their "buyout" clause thingy. The way she explained it to me, if I'm enrolled in the NYU LRAP/IBR program, and after X number of years I switch into a job that no longer qualifies for PSLF or surpasses the income cap or something, NYU will submit a one-time payment, or "buyout," that would set you on track with the solo-LRAP program. I know thats kind of confusing, but the idea is that with IBR you wouldn't have actually paid down your debt over those X years, so instead of leaving you fucked, NYU will pay the amount that you would've paid over X number of years that you would've been enrolled in standard LRAP.

however, she said they take certain things into account like your salary over those years etc etc etc, so I doubt they allow the payout to be huge.

Let me know if this makes sense/if you see any places I'm misinterpreting

What you said about the comparison does make a lot of sense to me. I guess I should have been a bit clearer about what I meant by Columbia maybe being a "better bet" -- and that's exactly what you specified about having some more flexibility with regard to the program and potential qualifying employment. I really hope you're right that nothing with PSLF/IBR will change in the near future...Also, I would like to believe that if there are any drastic changes, we would all be grandfathered into these programs, assuming we enroll before these changes occur.

Of course, no one really knows what will happen. IIRC 2017 is the first year in which graduates will have their loans forgiven after their 10 years, so I'm sure this whole conversation will really ramp up again around then.

I am a bit confused about that buyout clause you mentioned -- I don't exactly remember reading about it, though I do need to do some more research. I'm not totally sure what that buyout covers. Do you mean they would pay you retroactively for the years you already completed in PSLF/IBR as if you had been in LRAP only? That does sound nice, though you're right that it definitely depends on how that buyout is calculated...

You found this all in the NYU LRAP explanations, right? I'm going to NYU's ASD tomorrow, so I won't have much time to check it tonight - I'll take another look over the weekend. This is a good discussion though, and I'm glad to be talking about this with other people in the same boat. Really hope others will join too/add some sage advice!