Student loans are a fact of life—especially for graduate students in law and healthcare. Grad school may be expensive, but because many students find highly paid careers after graduation, it may make sense to borrow to pay for it.
What if you don't make all that much money when it's over, though? What if you get a job as a public defender, civil servant, or primary care doctor in a low-income region? You'll be doing important work, for sure, but at a salary that may make it hard for you to repay both your grad school and undergrad loans.
You may already know about federal loan forgiveness options. However, in addition to those options, many schools, employers, state offices, and other organizations offer their own Loan Repayment Assistance Programs (LRAPs) that can help you put a dent in your debt.
What Is An LRAP?
LRAPs are programs that help you pay down your student loans faster after you graduate. LRAPs differ depending on who offers the loan repayment. Here are a few potential providers:
Schools offer LRAPs as an incentive for students to enter high-need fields or areas of expertise that pay less than others after graduation. For example, many law schools offer LRAPs to graduates who practice law in the public interest sector, as a public defender or in another area that pays less than a corporate attorney would receive.
Because they're school specific, each LRAP is different. Their requirements, the amount they'll repay, and the amount of service they'll require will vary. In fact, different graduate departments within a single university may have different rules. Harvard Medical School has a different LRAP from Harvard Law School, for example.
Before you commit to borrowing student loans for a graduate degree, look into whether your school offers one of these programs. This shouldn't be the main reason you choose to go to grad school, but it can be a nice additional benefit.
Many employers realize that graduates—especially those in occupations that require advanced degrees—may bring a briefcase filled with student loans to work with them. To help ensure this debt doesn't deter the best recruits, organizations may include an LRAP as part of a job offer. This is most common in health professions, the public sector, and the legal field.
During your interview process, ask if the company offers an LRAP or other student loan reimbursement program. This may help you with your employment decision.
States recognize that health professionals and other high-need fields underserve some geographical areas. To encourage recent graduates to work in these high-need fields and/or high-need zones, some state offices offer LRAPs.
For example, a state's health department may offer an LRAP that requires 2 to 4 years of service as a primary care physician in a low-income area. In return for your service (on top of your salary), you will receive a lump sum payment annually toward your student loan debt. A program like this encourages doctors to serve a population that may not receive adequate medical care otherwise.
Each state and state office is different. You may have to do some digging with your professional organization, such as the Association of American Medical Colleges or the American Bar Association. Also, check your state department’s website, such as the Department of Health and Human Services or another department depending on your field, to learn about available LRAPs.
Questions To Ask About An LRAP
Different LRAPs have different requirements, and failing to meet them could prevent you from receiving the amount you expected. To make sure you understand how your LRAP works, ask the following before you get started:
1. Where do I need to work? You may need to work for a specific agency, in a specific geographical area, or in a specific high-need field.
2. How long do I need to work in this field or in this area? You will likely need to commit to a certain period of service to be eligible for the LRAP.
3. Is there a limit on how much I can earn per year to be eligible? You'll want to check that your income won't affect the repayment benefits ahead of time or be aware of a limit.
4. What student loans are eligible for repayment? Some programs may only repay federal student loans.
5. How much will be put towards my loans and when? Not all programs pay out the same way. Some make your monthly payments for you; others reimburse you at the end of a year of service. The difference could really affect your monthly budget.