No Student Loan Forgiveness for Public Service Lawyers Under Trump's Plan

By William Vogeler, Esq. on February 14, 2018 | Last updated on March 21, 2019

When it comes to President Trump's plan for public service loan forgiveness, forget about it.

There is no forgiveness for law students who go into public service jobs under the new plan. The American Bar Association sensed it was coming when Trump won the election, and now it is getting real.

If the budget goes through, the kick-to-the-gut won't kick in until next July. Better borrow like there is no tomorrow, or forget about it.

Public Service Loan Forgiveness

The door started to close on the program in 2016 when the Department of Education decided that ABA lawyers and other organizations did not qualify for PILF. To qualify for the program, the department said attorneys must work for a government agency, 501(c)(3) organization, or non-profit organizations providing specific public services.

The ABA sued, saying it wasn't fair to lead law students into massive debt and then pull the financial rug out from under them. The new plan will push them to the floor.

Mark Kantrowitz, a student loan expert, said the proposed budget also cuts back income-driven repayment plans for all borrowers. Payments would be capped at 12.5 percent of their income, and graduate students wouldn't qualify for forgiveness for 30 years.

"Graduate students would be paying significantly more," Kantrowitz told CNBC.

Fewer Public Interest Lawyers?

With the cuts, Kantrowitz said fewer people will pursue degrees that lead to public service occupations. There will be not be as many prosecutors and public defenders, he said.

"This is completely unfair, and penalizes those who took on significant debts in order to dedicate their lives to serving their communities," chimed in Above the Law.

Of course, the trickle-down effect will impact law schools as well -- only it will not be rain drowning out the aspirations of public-service minded students.

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