Law Schools, Student Loans

Income-Based Law School Debt Repayment Will Eventually Ruin You Financially

Your law school debt will come back to haunt you even after it's been forgiven.

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Game of LoansIt’s incredibly depressing to think about, that bankruptcy may be your only option … to start over at 55 when you worked so hard to get an education to better yourself and society.

— Michael Hulshof, a 2012 graduate of the University of La Verne College of Law who was profiled in a recent NBC News article on personal finance, commenting on the ticking tax time bomb that’s perhaps better known as income-based loan repayment.

(When Hulshof graduated from law school, he had $145,000 in student debt. Today, thanks to accruing interest of roughly $1,500 a month, he has about $220,000 in student debt. By the time his debt is forgiven at the end of the 25-year repayment plan, he’ll owe the government approximately $400,000. Hulshof estimates that he’ll owe up to $175,000 in taxes on his forgiven law school debt.)

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