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Related Discussions
Prosper Act implications on law school funding
supboarder
Alum Member
Is anyone else worried about the passage of the PROSPER ACT? it these new regulations are put into effect student loans will be capped at 28500 per year. How can anyone pay their law school tuition if PROSPER passes since that number is way below even part time tuition at many law schools?
http://prawfsblawg.blogs.com/prawfsblawg/2017/12/a-looming-asteroid-for-law-schools.html
Comments
If I understand that properly, anyone who has already taken out loans for their undergrad or will be enrolled in law school following the next cycle, should be exempt from this change.
However, I wonder how it will play out beyond that for the reasons you cite above. It seems like a glaring oversight unless these articles are missing information.
Actually the House just passed the PROSPER Act a few hours ago. I did not want to take out loans for undergrad, but I will check out what you mentioned about taking out Stafford loans now to get grandfathered in. I am still not sure whether those loans would be capped at 28500 as well.
https://www.chicagomaroon.com/article/2017/12/16/prosper-act-student-loan-house/
whoa, just learning about this. O_O
I'm reading the US news article and it says that the Prosper Act's ONE Loan program is going to kick in 2024. So for those who are applying to law school soon, this shouldn't be an issue. However, the future generation may get the bad end of the deal
Just checked that site too. Hmm, so it seems like they are going to make it just 1 federal loan as of July 2019 which I'm guessing will be like now, with no limit? Then in 2024 is when things will get more complicated. this seems like a huge mess either way wtf..
It is an issue if you start fall of 2019, as you will only be able to take out the new Direct one loans capped at $28,500 annually " Graduate students will see their loan limits set at $28,500, as opposed to the current limit, which is the total cost of attendance. For parents, the loan limit would be set at a flat rate of $12,500, as opposed to the current limit, which is the cost of attendance wherever their child attends college."
So how exactly does one pay for school if not on loans or scholarships? And if family has no money.
so the government is basically telling us to screw off. nice.
welp, good thing i took out loans for undergrad ....
Private loans at really high interest rates. It will be a bad idea though.
The class entering Fall 2018 is safe. The PROSPER Act takes effect for those entering Fall 2019 or later. Personally, I am really devastated at this news because it means that some dream law schools may be out of reach if you are relying on student loans and can only take out 28500 per year. I do think you need to think strategically and plan, so if you can only take out 28500 per year and really want to go to law school I think the best strategy is to plan for part time tuition where the cost is less. Still most law schools charge 35k or so for part time, unless it is a state public law school. So you could theoretically work full time and perhaps get some scholarships or pay the tuition that is not covered out of the 28500 with your earnings from work.
https://www.usnews.com/best-graduate-schools/top-law-schools/part-time-law-rankings
http://www.reactiongifs.com/r/2012/12/unfair.gif
So. If I haven't had to take out any loans for undergrad and I'm planing on applying for fall 2019, should I bite the bullet and take out a loan?
You should probably wait a few weeks to make a decision and see how this all shakes out. Most schools are on closure now so financial aid deans will probably not be writing anything on the impact to law schools. If I see anything new I will post it here. The PROSPER act has a great impact on those thinking of taking a gap year after graduating and postponing starting law school until Fall 2019, but it seems like you if need loans it would be best to start Fall 2018 before the new PROSPER regs kick in.
For myself, I hate to suggest taking out loans, but if you are starting Fall 2019 or later it might be best to take out a small loan while still in undergrad. That way you can get grandfathered into the existing loan programs, that seem to have more favorable terms of repayment and subsidy, rather than PROSPER Direct one loans that will start Fall 2019.
http://prawfsblawg.blogs.com/prawfsblawg/2017/12/a-looming-asteroid-for-law-schools.html
http://news.ufl.edu/articles/2017/12/5-ways-the-proposed-prosper-act-could-impact-students.php
Sorry--I don't know much about this and have to ask: Why are they doing this to students?
@lsatplaylist
My guess would be that it has 2 aims. First, it deregulates the loan process in such a way that *non-accredited institutions (ITT tech) now are eligible to receive the new loans. Perhaps since they are broadening that eligibility they are assuming more loans to be taken out and so the cap is in place to protect to account for that.
And second, to reduce future debts as a result of student loan defaults which are on the rise again and currently sit at ~11%. https://www.forbes.com/sites/zackfriedman/2017/10/06/student-loan-default/#d664c6328deb
But. Just a guess. I'm a little shocked I heard nothing in the news about this since, if we are understanding this correctly, it affects so many people and I am an absolute news junkie. Even as a cynic, I would expect CNN, ABC, MSNBC to be screaming this from the hill tops since it is so bad on it's face and was passed without dems in the house.
EDIT: meant to say non-accredited not accredited
Yeah... where is the news coverage?! I'm shocked at this. This totally makes February my last test. I think. Am I understanding that if I start in Fall 2019 since I took UG loans I'd be grandfathered in and can exceed the $28,500 cap, or if I start in Fall 2018 I am grandfathered in? This is huge. I am depending on loans exceeding the cost of tutition to pay bills and support my kids while in law school. If I am capped at 28k I don't see that happening. Well, not so much shocked at disheartened.
I find the timing of the passing of this PROSPER act to be very suspicious. First of all I have been attending numerous visiting law schools coming to my college, some in the 70k per year annual cost, and I also attended two seminars on financing your law school education. At no time did anyone ever mention that there would be a 28500 cap on grad school loans coming (except loans for med school). I guess they just wanted as many applications in as possible this round before the loan cap was announced. It makes it difficult to decide what to do. If I started law school even after taking out undergrad loans will everyone be capped at 28500 per year, or just those starting with the new Direct one loans in 2019? It doesn't seem entirely clear. Also I note that many posters talk about waiting for scholarships, but if this bill is the so called asteroid to hit law schools funding, law schools may be thinking they will not have funding to award multiple year scholarships any longer. However, I would honestly rather know than starting at a school and not having funding to pay for it the next years and then having to drop out and immediately start repaying the monies owed. Also, it is funny the House waited to drop this bomb until schools are all closed and students cannot organize a protest against the PROSPER act. United we are a large group, individually no.
Also, I'm a little confused why none of the articles I've read have mentioned the Senate since they have to debate and vote on it as well in order for it to become law. A bill goes from the House to the Senate so maybe that is why we haven't seen more visible coverage yet. It could look completely different by the time the Senate votes on it.
this is true.
I think the whole thing is just ONE (no pun intended) big mess.
Isn't the Senate controlled by the Republican party currently? While I really pray for a Hail Mary that raises the proposed 28500 loan cap I don't really see that happening in the current political climate in Washington. If you look at the comments in the articles many people seem to get angry about supporting graduate students or high dollar tuition. Also, we should not forget that these proposed loan caps do not just affect law students, but anyone who maybe attempting grad school except medical students, whether it is a Masters in Social Work or Forestry. That low of a loan cap would make it difficult to both pay tuition and live in an urban area where rent is expensive.
"Much of the growing enmity for higher education from Republican political leaders has been aimed at wealthy research universities and elite colleges, such as criticism of $60,000 annual tuitions or large endowments (most recently in the tax reform legislation now before Congress), doubts about the value of research and the liberal arts, and escalating complaints about perceived political correctness and liberal bias."
In 2018 when some version of this is likely to be voted on in the Senate, republicans will have 51 seats. If the democrats hold, they can't lose more than a single vote and also would not be able to break the fillibuster. So it is not a done deal.
We don't need all that long a hail mary. It could go either way.
I would think that should make it more deservimg of national media attention and not less.
As if I needed more anxiety about law school. This is insanity.
Here is the link to the bill from the Congress bill tracker website:
https://www.congress.gov/bill/115th-congress/house-bill/4508/text
I find it more likely than not that the House and Senate will pass this bill given that both are Republican majorities. It seems to me that you can't be grandfathered in if you take out Federal Direct loans for undergraduate education. You can only be grandfathered in if you take out Federal Direct loans for a graduate or professional program, not an undergraduate program. This would impact students who are enrolling in graduate programs in Fall 2019 and thereafter. Even if you start graduate school in Fall 2018 and take out Federal Direct loans for that year, the amount of loans cannot exceed $28,500 for any academic year beginning after June 2019 (see below text).
“(i) GRADUATE OR PROFESSIONAL STUDENTS.—In the case of a graduate or professional student who is not described in subparagraph (E) and who has received loans made under part B or D for enrollment in a graduate or professional program at an eligible institution, the total amount of which equal or exceed $28,500 as of the time of disbursement, the student may continue to borrow the amount of loans under this part necessary to complete such program without regard to the aggregate limit under subparagraph (B)(ii), except that the—
“(I) amount of such loans shall not exceed the annual limits under subparagraph (A)(ii) for any academic year beginning after June 30, 2019; and
“(II) authority to borrow loans in accordance with this subclause shall terminate at the end of the academic year ending before September 30, 2024.
This is not good. So, in other words, there is no grandfathering in? If you start in '18 you're still subject to the cap in your 2L if that commences fall of '19.
@supboarder the same republican controlled senate/house (in fact with a stronger majority) has failed to pass several republican, well-known pieces of legislation to date. And it's rare for a bill to pass freely from house to senate to law without changes and concessions.
Write your senators and manage your concern until you know what the final bill will actually look like. My 2 cents.
P.S. The Senate mid-terms are next year making a lightning rod piece of legislations such as this difficult to get through.
So I am still confused. I graduated in 2016 and am planning on starting in Fall 2019. I took out loans then, would I still be able to be exempt for these changes?
The reason why I am asking if because there will be a 3 year gap in between the time I graduated and when I would start law school.
This honestly makes me so mad.
You might not under the language of this bill. Write your senator, especially if your state has a republican senator.
There is no guarantee that this passes the Senate. Next session the Republicans will only be able to lose 1 vote and pass a bill through the Senate. That means that if we can convince 1 or 2 Republican Senators this provision of the bill is a bad idea, the can go to their colleagues and say that part has to change. A bunch of the Republican Senators are former lawyers so they might feel slughtly sympathetic(or scared of our activism or whatever).
Here is a new article on the PROSPER Act so more people are becoming aware of the issue.
"The bill also caps how much a student can borrow for graduate or professional school at $28,500 per year. (Under the current Direct Loan system, a student can borrow as much as it costs to go to graduate or professional school.) As a result, many borrowers will be forced to seek help from private sector lenders. Those without the financial resources to obtain private loans would simply not be able to attend graduate or professional school. "
https://www.huffingtonpost.com/entry/how-the-prosper-act-hurts-graduate-and-professional_us_5a38084be4b02bd1c8c60907
I'm not seeing who is grandfathered in.
@dytmom_3x It appears from the wording of the bill that you are only grandfathered in if you have taken out Federal direct loans for a graduate program. Even if you have taken out Federal Direct loans for undergrad, you are not grandfathered in as the loans must be for a graduate program. If you are starting graduate school in Fall 2018 and are taking out Federal Direct loans, there is no $28,500 cap for that academic year. The following academic years will have a $28,500 cap. At least that's my interpretation of the wording. Keep in mind that the bill was just introduced earlier this month and has not passed House yet.
This makes writing your senators easy. I would suggest using it in conjunction with a proper email/letter.
"Text RESIST to 50409 or message me on Facebook and I’ll find out who represents you in Congress, and deliver your message to them in under 2 minutes. No downloads or apps required."
https://resist.bot/
So one would have needed to take out grad loans by when to be grandfathered in? Before the fall of 2018?
If you don't have a credit card/other line of credit, I suggest getting one right now, just in case you need private loans
With these turn of events, theres a much stronger case for future applicants to retake as much as possible to maximize scholarship money, within reason of course
I'm very concerned about this. Assuming the COA for law school in big city is about $90k a year, is it seems to me that it is very challenging to get extra funding from a priviate source for those whithout co-signer or parents' helps)
For example,
($90k-$28.5k = $61.5k) * 3 years = $184.5k total needed from a private source??
.....
Haven't heard much on it lately. Anyone know where it stands?
I'm pretty sure it still has to be passed by the House and then the Senate. The Senate will be a lot closer than the House since republicans only have one extra vote and it is worth noting that bills are less likely to pass as we get closer to midterms.
I think it is basically ready for a vote when Ryan wants it in the House.