1. You don’t have to be “low income” to qualify for LIPP.
“LIPP is extremely generous and it’s absolutely livable.” This is a common refrain heard from HLS graduates who use LIPP to repay their student loans. Andrea Saenz (’08), a Clinical Teaching Fellow at Benjamin N. Cardozo School of Law, said, “I think there’s not enough accurate information out there about how much public interest lawyers make and how we’re not all living on ramen with six roommates.” Because LIPP has no income cap, graduates who earn six figures may still be eligible depending on the amount they borrowed. For example, someone with $126,000 of law school debt (the average for a 2013 HLS graduate) who makes $70,000 in her first year and $91,000 in her tenth year will have more than half of her loan expenses paid by LIPP.
2. LIPP allows for career flexibility.
You can enter or exit LIPP anytime as long as you are still repaying education loans and stay in LIPP if you move between eligible jobs. Lela Klein (‘09), a law fellow in the legal department of the Service Employees International Union (SEIU) who is currently receiving LIPP payments, started her career at a private labor and employment firm and found the staff in Student Financial Services “incredibly helpful, thoughtful, and professional” throughout her career transitions.
3. Payments go up as you have kids.
LIPP takes into account extra costs that come with having kids. Klein said, “With maternity leave, you still continue to qualify for LIPP…When I was in DC my child care costs were ridiculous. I was paying about $1,600 per month for child care, but that came out of my income. So when LIPP looked at that, they subtracted $1,600.” LIPP covers parental leave for up to six months and part-time work for participants with small children at an income level equivalent to the full-time salary.
4. LIPP won’t keep you from buying a house.
When you buy a home, mortgage companies usually look at your debt-to-income ratio, which may appear high if you are still receiving LIPP awards. “LIPP provides a letter that explains the program and says this person is expected to get this much additional funds per six months,” Klein said. “I went through a normal credit union to get my mortgage loan, and it was not a problem at all. Essentially I was able to follow up for more credit.”
5. Don’t want to be a lawyer or work for a non-profit? No sweat.
HLS graduates are notorious for their contributions outside regular legal practice and LIPP supports these efforts. Jobs in government, academia, and the non-profit sector are all eligible. Jobs in the private sector qualify if they are “law-related.” LIPP is explicitly designed to accommodate nontraditional careers.
6. LIPP can cover up to $30,000 of undergraduate debt and $10,000 of bar loans.
LIPP covers more debt than most people think. The easiest way to determine your eligible borrowing is to set up a meeting with program administrators at firstname.lastname@example.org.
7. You can still travel the world, eat sushi, and drink single-malt scotch.
The average income of a current LIPP participant is $59,748, which is three times the yearly budget of the average law student. “We’re still lawyers,” Klein said. “We’re still making a professional salary. For me, living in some place with a low cost of living, I’m way above the median income. I make very good money in comparison to anyone else in my field, plus I get LIPP. We’re able to eat at nice restaurants, go on vacations, and attend friends’ fancy destination weddings.”
8. LIPP provides a path to financial independence.
LIPP is designed to enable HLS grads to pay back their loans in ten years or less, but many participants are able to save money and leave the program sooner. The average length of participation is 3.4 years, partly because graduates often move in and out of the public sector.
9. HLS sends you a check every six months.
Graduates’ favorite part of LIPP is the check they receive every six months from HLS. Participants are required to report their income and assets to Student Financial Services twice a year. “It’s never taken me more than about two hours. It’s an online application that is pretty streamlined,” Klein said. “You print off your monthly statement from your lenders and you just have to document your tax returns and income and your employer fills out a form for you.”
10. What’s the catch?
Many students interested in LIPP feel like the program must be too good to be true. But everyone we talked to said there is no catch. LIPP has become a primary draw for law school applicants and HLS shelled out $6.3 million on the program in 2012-2013. That’s no joke.