<p>"A small but growing group of colleges are guaranteeing students that they will help them pay their student loan bills until they secure a well-paying job." </p>
<p>These</a> colleges will pay your student loan bills - Jan. 22, 2014</p>
<p>The article wasn’t clear, is this federal loans only? I can’t imagine this happening for private loans.</p>
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<p>No, she won’t. That’s impossible. Even for an independent student, that’s more than the limit. </p>
<p>If she’s including Parent Loans then they’re not HER loans.</p>
<p>The program actually does cover private and Parent PLUS loans … up to $17,000 per year and $70,000 total. Info is here: <a href=“http://www.arbor.edu/wp-content/blogs.dir/7/files/2012/11/LRAP-Terms-and-Conditions.pdf[/url]”>http://www.arbor.edu/wp-content/blogs.dir/7/files/2012/11/LRAP-Terms-and-Conditions.pdf</a>. You must be employed at least 30 hours a week, earning at least minimum wage. It’s an interesting program.</p>
<p>I know many recent grads with <30 hours per week. Doesn’t seem like these folks would be covered.</p>
<p>Not all LRAP’s are the same. I was shocked when my D1 was reviewing Law School LRAP’s and some were atrocious (even in the top 5). The devil is in the details. </p>
<p>So for Spring Arbor – if you make $20k per year (the income that gets the largest loan assistance) and have the maximum loans allowed in the program ($70k) which is possible since they credit Parent Plus, student loans and private loans your assistance would be equivalent to your full loan payment. But notice these caveats:</p>
<p>Your Repayment Assistance will be calculated after taking into account any loan repayment assistance for which you are eligible under any federal, state or other program (e.g. “IBR”).</p>
<p>PLUS loan assistance is only for amounts due after graduation (so you have to pay on them during school and not delay them)
You can be in the repayment assistance up to 10 years as long as your income is below the threshold of $38k </p>
<p>Assuming $27,000 student loans at 3.8% and $43,000 of Plus loans at 6.8%
IBR on $20k* income is about $16/month SL and @ $500/month PLUS school would pay $516</p>
<p>IBR on $29k* income is @ $117/month & @ $500/month PLUS the school would reimburse 50% = $309</p>
<p>These school repayments last for 10 consecutive years (minus grad school).</p>
<p>If you use “Income Base Repayment” (IBR) for the student loans you will be extending those loans for 25 years (in which time you will likely rise above the income cap). The private and Plus loans don’t have IBR so you would be paying on the normal plan but you have to pay both private and Plus while you are in school.</p>
<p>The student loans in IBR will not be paid off in 10 years –you will likely owe MORE on the student loan portion than you started with. If you use “Pay as You Earn” (PYE) you will be increasing the student loan portion every year.</p>
<p>If your income did not increase over 10 years at $20k income the remaining balance due on the $27k in student loans would be $34,325 (IBR) and $34,325 (PYE).</p>
<p>For income of $29k the balance would be $27,315 (IBR) and $29,680 (PYE)</p>
<p>*Gross income as required by school plan. The Feds allow deductions to calculate payment.</p>
<p>tl/dr - be careful of LRAP’s- run the numbers and know the details.</p>
<p>These seem like some large loans to be assuming to be attending colleges who don’t have much of a broad “brand name.” I would wonder how many recent grads would get full time jobs upon graduation meeting the criteria. It might be better to look for a job that would offer to help pay off your loans. I know S’s job would have helped him pay off any loans he had taken on for his education, as long as he promised to work for some set duration. Didn’t explore it because he didn’t have loans, but I’m sure it is attractive to students with debt. Some public service fields also have loan forgiveness. </p>