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Frequently Asked Questions: Loan Repayment

The College Cost Reduction and Access Act (CCRAA) of 2007 established, among other things, two new programs that will be of particular interest to graduates going into low-paying and public interest jobs. Income Based Repayment (Section 203 of the Act) allows borrowers to pay back their federal loans on the basis of their income at the time of repayment. Loan Forgiveness (Section 401 of the Act) will forgive federal Direct loans after 120 payments and 10 years of full-time employment in the public service sector. It is possible to take advantage of both these programs at the same time, or to elect one or the other option. One option does not either preclude nor exclude another.

INCOME-BASED REPAYMENT (IBR)

What is Income-Based Repayment?

Which loans are included?

How does it work?

 

Traditional Debt Management Program (LRAP)

This program is for the entering classes of 1984–2010. If you are from the entering class of 2011 and later, you must review the Income-Based Debt Management Program FAQ (see next section).

The University of Michigan's traditional Debt Management Program is a complicated program, because of our concern for fairness for all participants. That means there are a lot of details and subtleties in the program that can best be explored by discussing your particular situation with a financial aid counselor. This FAQ hopes to address general questions about the program for you. Please let us know how else we can be of assistance.

Generally, how does it work?

What kind of debt is covered?

What kinds of jobs are covered?

So your program is not limited to public interest jobs?

Does your job have to be in the U.S.?

What is the salary cap?

How many years can you be in the program?

Do I have to get into the program right after law school?

Where can I get more information?

 

Income-Based Debt Management

The University of Michigan Law School has an LRAP (loan repayment assistance program) that supports our graduates so they can pursue the area of employment that they truly love, without the debt they may have incurred in Law School directing their choice. This FAQ addresses general questions, but there are a lot of details and subtleties in the program that can best be explored by discussing your particular situation with a financial aid counselor. Please contact us at lawfinaid@umich.edu if your particular questions are not answered here.

How, generally, does it work?

What does Michigan's program provide?

Who can apply for this program?

How many people participate in the program?

What is the salary cap?

What kind of debt is covered?

What kinds of jobs are covered?

So the program is not limited to public interest jobs?

Does my job have to be in the U.S.?

Do I need to make a long-term commitment to the program?

How many years can I be in the program?

Is it "free money," or do I have to pay it back?

Do I have to get into the program right after law school?

Where can I find more information?

How do I apply for the Income-Based Debt Management Program?

 
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