Loan Repayment Assistance Programs
The deal: Help paying back student loans.
The government offers an income-based repayment option that will cap your monthly loan payments according to your paycheck, but that's only available on federal student loans. Loan Repayment Assistance Programs, or LRAPs, cover both federal and private student loans, as well as Parent PLUS Loans. Designed to help foot student loan bills for graduates with moderate incomes who are working at least 30 hours per week, LRAPs are available at a few dozen undergraduate institutions and more than 100 law schools. Terms and conditions vary by school, but many programs offer some assistance to recent undergraduates earning less than $38,000 annually and pay the entire loan tab for graduates earning $20,000 or less, says LRAP Association President Peter Samuelson.
"(Students) get their financial aid award and they say, 'I just can't afford it,'' Samuelson says. "What LRAP does is takes away that fear and says if your income is low, we'll help you make your loan payments."
For undergraduates, LRAPs can be applied to a maximum of $17,000 in loans per academic year, and self-employed graduates and those working for family businesses aren't eligible. To find out if your school offers an LRAP, contact your financial aid office.