Marino’s Legal News: Help On The Way For Those With Massive Law School Loan Debts

The vast majority of law school graduates start off their careers with student loan debt accumulated during law school. In some cases, the amounts owed are relatively small and can be paid back over the first few years of practice. In many cases, however, the debt is in the hundreds of thousands of dollars and may be an albatross around an attorney’s neck for many years to come.

The American Bar Association published a recent survey on student loan debt, and of 1,084 lawyers contacted, the average total student loans owed at the time of law school graduation was $164,742. Many respondents reported that these loans contributed to mental health issues they were experiencing.

This is one reason why many attorneys are so interested in the ongoing debate about forgiving student loan debt. President Joe Biden has discussed a plan to forgive a significant amount of debt, but the details of such a plan will determine if it helps attorneys, and how many would see any real benefit from it.

One of the issues being debated is how much debt would be forgiven under any proposal. The Student Loan Debt Relief Act, sponsored by Senator Elizabeth Warren in 2019, would have cancelled up to $50,000, but only for borrowers with adjusted gross income of no more than $100,000. Borrowers with incomes above that figure might be eligible to receive partial loan cancellation. This plan has been promoted by Democratic politicians who tend to be on the more liberal side of the political divide.

President Biden himself prefers a more conservative figure than many of his fellow Democrats. During the Presidential campaign, he went on the record as supporting student loan debt cancellation, but only up to $10,000 per student.

Another major sticking point is whether loans owed to private lenders could be excluded from a plan. Experts have stated federal student public loans are relatively easy to forgive because the government simply would decline to collect the amount owed. In order to cancel private debt, the government would need to actually pay private lenders to offset the amount owed which could prove more complicated and politically divisive.

Lastly, there is an issue that some Democratic politicians have brought up, which is whether a debt loan forgiveness program might only apply to those who went to public or state schools. President Biden himself has said during the 2020 campaign that he was not in favor of loan forgiveness for individuals who attended “elite” schools.

While there is a public perception that all attorneys are rolling in money, the truth is that lawyers, especially those graduating right now in the current economic downturn, face a tough job market and most would be very appreciative of any help they can get to make their law school loan burdens a little bit lighter. You can read more about this important issue here.