The American Bar Association has a plan to help out unemployed lawyers with their student loans. Seriously. An actual plan. The National Law Journal reports:
The ABA wants the government to let unemployed graduates convert private loans into federal ones. The change could allow them to defer repaying those loans for as long as three years.
The plan is so simple and helpful that I’m almost positive Congress will find a way to horribly mess it up. The ABA wants to let people borrow money from the government to pay off their private loans. Then unemployed lawyers can put their new federal loans into deferment for up to three years if they need to.
The effort is in its early stages — executives of the largest provider of private law school loans, Access Group Inc., weren’t even aware of it, according to spokeswoman Linda Smith.
“This is really intended to give them some breathing room,” said ABA President Carolyn Lamm.
The plan was proposed by the ABA’s recently formed Commission on the Impact of the Economic Crisis on the Profession and Legal Needs, which is examining how lawyers can confront the recession.
Of course, nobody knows precisely how the plan is going to work.
There should be a lot of winners with this plan. Private lenders will actually get money from students who won’t otherwise be able to afford to pay off their loans. Unemployed lawyers won’t see their credit rating destroyed. And the government should make money back on the interest — assuming these lawyers are one day able to find gainful employment.
So, how do we make it happen?
It’s not entirely clear how this change would be accomplished. The ABA would prefer a modification of the regulations pertaining to federal student loans, although legislation might be required, [Peter Halle, a senior counsel at Morgan, Lewis & Bockius] said. The plan would be “revenue positive” for the federal government, he added.
This makes way too much sense. Let’s hope nobody screws it up.
ABA Proposes Law Student Loan Relief [National Law Journal]