Loan Repayment

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In law school, you were occupied with reviewing interpretations and writing briefs – not thinking about loan repayment. Now that you’re a graduate, it’s time to transition from student life to real life. Carolina Law provides access to financial guidance and support in the form of loan repayment assistance, information on debt management, and advising regarding common financial questions that may arise after graduation.

Understanding Your Loans

Most of our students use federal education loans (unsubsidized loan and the Graduate PLUS loan) to finance their law school education, but some students use private education loans. If you have a private education loan, please contact the bank or lender; the following information is for federal education loans.

To determine how much you’ve borrowed in federal loans (including undergraduate loans), access your record on the National Student Loan Data System. Selecting the number next to each loan gives you detailed information about that specific loan, including your loan servicer (current ED Servicer). Create an account on your servicer’s website. You may have more than one servicer; if so, be sure to create an account on each servicer’s site.

Understanding Your Loans

Repayment

After graduation, you have a six month grace period on your law school federal loans before repayment is required. Depending on your situation at the end of the grace period, you may choose to make payments or postpone payments.

If you choose to make payments, you have several repayment plan options. Your repayment plan determines your monthly payment amount, which is influenced by several factors – including your repayment period length. Your repayment period length also determines the total amount of interest you will pay over the lifetime of your loan.

Loan Repayment Chart

Your loans are automatically placed into the Standard (Level) Repayment Plan. To request the Graduated or Extended repayment plans, contact your servicer. To apply for an Income-Driven repayment plan, complete the Request. There are five Income-Driven repayment plans: Income-Based Repayment (IBR), new IBR, Pay As You Earn (PAYE), Income-Contingent Repayment (ICR), and Income-Sensitive. If you meet the criteria, you will be placed into the Income-Driven repayment plan which you qualify for that is most beneficial to you. The Repayment Estimator will allow you to compare your monthly payments under the different repayment plans and give you an idea which Income-Driven repayment plans you may qualify for.

If you choose to postpone payments, your options are deferment or forbearance. Certain situations qualify for deferment. For example, while you were a School of Law student, you qualified for in-school deferment. If you don’t qualify for a deferment, your servicer may be able to grant you a forbearance. With forbearance, you may be able to stop making payments or reduce your monthly payment. To apply for a deferment or request a forbearance, contact your servicer.

If you’re having difficulty making your monthly payments, don’t let your loans go into default – contact your servicer. You could be eligible for a repayment plan with lower monthly payments or postpone payments through deferment or forbearance.


Public Service Benefits

Working in public service is not just about the paycheck; it’s also about the mission and making a difference. While public service typically doesn’t pay like the private sector, we need people performing these important roles in their communities. Two programs, Public Service Loan Forgiveness (offered through the U.S. Department of Education) and Loan Repayment Assistance Program (offered by UNC School of Law) work together to encourage individuals to enter and continue to work in public service careers.

Federal Public Service Loan Forgiveness (PSLF)

PSLF is a loan forgiveness program for certain federal loans. After making 120 qualifying payments while employed in eligible public service organizations, borrowers may qualify for forgiveness of the remaining balance of their federal education loans.

UNC School of Law Loan Repayment Assistance Program (LRAP)

LRAP provides a short-term forgivable loan toward repayment of qualified law school education loans for eligible graduates who enter law-related public service jobs. This program works in conjunction with PSLF; alumni use LRAP funds to make monthly payments on their federal education loans during their period of 120 qualifying payments.

LRAP Fact Sheet (PDF)

UNC School of Law | Van Hecke-Wettach Hall | 160 Ridge Road, CB #3380 | Chapel Hill, NC 27599-3380 | 919.962.5106


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