LAW SCHOOL LOANS

Yes, law school students can still take out both federal and private student loans during the COVID-19 pandemic. Keep in mind that if you need to borrow for school, it’s usually best to rely on federal loans first since they come with federal benefits and protections — such as access to income-driven repayment (IDR) plans and student loan forgiveness programs.

If you decide to get a private student loan, be sure to consider as many lenders as you can to find the right loan for your needs.

If you decide to take out a private student loan for law school, it’s wise to shop around and compare your options from as many lenders as possible. This way, you can find the most optimal loan for your unique situation.

Here are several important factors to keep in mind as you do your research:

• Interest rate: Your interest rate is one of the biggest factors that will affect how much you pay for your loan in the long run — the lower your rate, the more you’ll save overall. Both your credit score and the repayment term you pick can impact the rates you’re offered by lenders.
• Repayment terms: You’ll typically have five to 20 years to repay a private student loan, depending on the lender. While choosing a longer term could get you a lower monthly payment, it’s usually best to pick the shortest term you can afford to keep your interest costs as low as possible. Many lenders also offer lower rates to borrowers who opt for shorter terms.
• Loan amount: Some lenders will let you borrow up to your school’s cost of attendance while others set lower loan maximums. Since law school can be expensive, it could be a good idea to look for lenders that provide higher loan amounts.
• Fees: Private student loan lenders sometimes charge fees — such as origination fees or prepayment penalties — that can increase your overall loan cost. Keep in mind that if you take out a loan with one of Credible’s partner lenders, you won’t have to worry about application, origination, or disbursement fees.
• Discounts: Many lenders offer rate discounts to borrowers, which could help you save money over the life of your loan. For example, some lenders will give you a rate discount if you sign up for automatic payments. And others provide discounts to borrowers who already have an account with them.

If you’re ready to apply for a private law school loan, follow these four steps:

1. Fill out the FAFSA. If you need to pay for law school, your first step should be completing the Free Application for Federal Student Aid (FAFSA). Your school will use your FAFSA results to determine what federal student loans and other federal financial aid you’re eligible for. Keep in mind that some aid is given on a first-come, first-serve basis — so it’s a good idea to submit the FAFSA as early as possible, especially if you have high financial need.
2. Apply for scholarships and grants. Unlike student loans, college scholarships and grants don’t have to be repaid — which makes them a great way to pay for law school. There’s no limit to how many scholarships and grants you can get, so it’s a good idea to apply for as many as you can. You might also qualify for school-based scholarships depending on your FAFSA information.
3. Take out federal student loans. Once you fill out the FAFSA, your school will send you a financial aid award letter detailing what federal student loans and other financial aid you’re eligible for. You can then decide which aid you’d like to accept.
4. Use private student loans to fill the gaps. After you’ve exhausted your scholarship, grant, and federal student loan options, private student loans can help fill any financial gaps left over. These loans are offered by private lenders, including online lenders as well as traditional banks and credit unions. If you decide to take out a private loan, remember to compare as many lenders as you can to find the right loan for you.

Yes, you can. Law school students can access two types of federal student loans, including:

• Direct Unsubsidized Loans: These loans are available to graduate and professional students — including law school students — regardless of financial need. Keep in mind that unlike with undergraduate Direct Subsidized Loans, you’re responsible for all of the interest that accrues on unsubsidized loans.
• Grad PLUS Loans: This kind of Direct PLUS Loan is available to students who want to pay for grad school or professional programs. Note that Grad PLUS Loans typically have higher interest rates compared to other federal loans. They also require a credit check.

When you take out law school loans, the lender will first disburse the funds to your school to cover tuition costs and fees. If there's money left over, you'll receive a student loan refund, which you can use to cover living expenses.

Note, however, that the U.S. Department of Education and many private lenders have limitations on which expenses you can use your loans to cover. That typically includes basic living expenses, such as rent, groceries, transportation, household and personal supplies, and other necessary costs.

If you're looking for financial aid to help you cover your living expenses while you attend law school, or you need help obtaining law school loans, contact your school's financial aid office for assistance.

Depending on your situation, you may have a few different ways to support yourself financially as a law school student. Many schools offer part-time programs, allowing you to obtain your degree without quitting your full-time job.

This approach can also be beneficial if you want to limit your reliance on law school loans for tuition and fees. It'll take you longer to graduate, but it can save you a lot of time and money if you can graduate with less law school debt.

If you've served in the military, you can also look into various educational benefits programs offered by the U.S. Department of Veterans Affairs. For example, the Post-9/11 GI Bill program is a popular option that could help you pay for tuition, fees, housing, and textbooks.

As you consider different financial aid options, check to see if your law school offers merit-based scholarships. You can also use websites like Scholarships.com and Fastweb, which manage databases of millions of private scholarship opportunities.

Federal law school student loans offer several potential benefits, including:

• Fixed interest rates: All federal student loans come with fixed interest rates, which means your payments will stay the same throughout the life of your loan.
• Federal protections: With federal loans, you’ll have access to major federal benefits and protections, such as IDR plans as well as deferment and forbearance options.
• Loan forgiveness: There are several student loan forgiveness programs available to federal loan borrowers. For example, if you work for a nonprofit or government agency and make qualifying payments for 10 years, you might be eligible for Public Service Loan Forgiveness (PSLF).

Federal student loans also come with some possible drawbacks, such as:

• Higher interest rates: If you have excellent credit, you might qualify for a lower interest rate on a private student loan compared to a federal loan.
• Student loan limits: You can only borrow up to $20,500 in Direct Unsubsidized Loans per year, which might not be enough to cover your law school expenses. However, you might be able to borrow up to your school’s cost of attendance with a Grad PLUS Loan or private student loan.
• Can’t lower your interest rate without refinancing: The only way to potentially reduce your interest rate on a federal loan is by refinancing it into a private student loan. But if you do this, you’ll no longer have access to federal benefits and protections.

Like federal student loans, private loans also come with their own pros and cons to consider. Some of the potential advantages include:

• Lower interest rates: You might get a lower interest rate on a private student loan compared to a federal loan if you have excellent credit.
• Higher loan amounts: Many private student loan lenders will let you borrow up to your school’s cost of attendance.
• No application deadlines: Unlike with federal student loans that come with a strict FAFSA application deadline, you can apply for a private loan at any time.

There are also some possible drawbacks to think about before taking out a private student loan, such as:

• Fewer options for poor or no credit: You’ll typically need good to excellent credit to qualify for a private student loan — which means you might have a hard time getting approved if you have poor or no credit.
• No federal benefits: Private student loans don’t come with federal benefits and protections.
• Lack of repayment options: You generally won’t have multiple repayment plans to choose from with private student loans. For example, you likely won’t have access to IDR plans or graduated repayment plans.

If you decide to take out a private student loan for law school, remember to consider as many lenders as possible to find the right loan for you. Credible makes this easy — you can compare your prequalified rates from multiple lenders in two minutes.

While eligibility criteria can vary by lender, there are a few common requirements you’ll likely come across when searching for a private student loan. These include:

• Good credit: You’ll generally need good to excellent credit to qualify for a private student loan — a good credit score is usually considered to be 700 or higher.
• Verifiable income: Some lenders have a minimum income requirement while others don’t. But in either case, you’ll likely need to show proof of income — especially if you’re looking to borrow a large enough amount to cover law school expenses.
• Low debt-to-income ratio: Your debt-to-income (DTI) ratio is the amount you owe in monthly debt payments compared to your income. To be eligible for a private student loan, your DTI ratio should be no higher than 40% — though some lenders might require lower ratios than this.

The credit score you’ll need for a student will depend on the type of loan you get. Here’s what you can expect when it comes to graduate student loan credit information for law school:

• Direct Unsubsidized Loan don’t require a credit check.
• Grad PLUS Loans do require a credit check. However, instead of needing to meet a minimum credit score requirement, you can’t have an adverse credit history to qualify. This means your credit history can’t contain negative information — such as a default, foreclosure, or bankruptcy — for the past five years.
• Private student loans You’ll generally need a credit score of 700 or higher to qualify for a private student loan, especially without a cosigner. There are also some lenders that offer student loans for bad credit, but these loans tend to have higher interest rates compared to good credit loans.

This depends on the type of loan you get for law school. Here are the student loan limits you can expect:

• Direct Unsubsidized Loans: Up to $20,500 per year ($138,500 aggregate limit)
• Grad PLUS Loans: Up to your school’s cost of attendance (minus any other financial aid you’ve received) 
• Private student loans: Up to your school’s cost of attendance (depending on the lender)

Federal student loan rates are set by Congress each year — the rate you get will depend on the type of loan you choose. Here are the rates you can expect on federal student loans for the 2021-2022 academic year:

• Direct Unsubsidized Loan (for graduate and professional students): 5.28%
• Grad Plus Loans: 6.28%

Interest rates on private student loans are set by individual lenders based on market conditions.
The rates you’re offered will also depend on other factors, including your credit score and the repayment term you choose. Here are the rates you can expect on private student loans from Credible’s partner lenders:

• Fixed rates starting at: 3.65% APR
• Variable rates starting at: 3.24% APR

There are also a few strategies that can help you qualify for a better rate and more favorable terms on a private student loan, including:

• Have good credit. Your credit is one of the largest factors that will impact your loan rates. In general, the better your credit score, the lower the rate you’ll likely get. If you have poor or no credit and can wait to take out a student loan, it could be a good idea to work on building your credit to qualify for better rates in the future. There are several potential ways to do this, such as paying all of your bills on time or becoming an authorized user on the credit card account of someone you trust.
• Apply with a cosigner. Having a creditworthy cosigner can make it easier to get approved for a private student loan, especially if you have bad credit. It could also get you a lower interest rate than you’d get on your own.
• Compare lenders. By shopping around and comparing your options from as many lenders as possible, you’ll have an easier time finding a loan with a good rate that suits your needs.

Law school can be extremely expensive, which is why the average law school debt is $160,000. The time it will take to pay off this debt will depend on several factors, including how much you borrow, your repayment term, and your income.

For example, if you have federal student loans and qualify for PSLF, you could have your loans forgiven after making payments for 10 years. Or you might sign up for an IDR plan or consolidate your loans into a Direct Consolidation Loan to extend your term up to 25 or 30 years.

If you have private student loans, you could have anywhere from five to 20 years to repay them, depending on the lender.

There are several law school loan forgiveness programs available to federal student loan borrowers. Some of these include:

• PSLF: Lawyers who work for nonprofit or government agencies and who make qualifying payments for 10 years could be eligible to have their loans forgiven through this program.
• U.S. Department of Justice Attorney Student Loan Repayment Program: If you commit to working for the Department of Justice for at least three years, you could receive up to a maximum of $60,000 in student loan repayment assistance.
• Perkins Loan cancellation: If you have federal Perkins Loans and work as a public defender, you might be eligible to have some or all of your Perkins Loans canceled.
• State Loan Repayment Assistance Programs: More than half of U.S. states offer student loan repayment assistance to lawyers working in public service. Be sure to check if your state offers one of these programs.

Unfortunately, private student loan forgiveness doesn’t exist. However, there are other options that could help you more easily manage and pay off your private loans, such as refinancing.

The best law school student loan lenders are ones that provide competitive interest rates, a wide selection of loan terms, inclusive eligibility requirements, and responsive customer service.

To find the best loan for your needs, it’s important to shop around and compare as many lenders as you can. Here are some of the most important details about the loans offered by Credible’s top medical school student loan lenders:

• Ascent: If you have poor or fair credit, Ascent could be a good choice for a law school student loan. You can borrow $2,001 to $200,000 (depending on if your credit is tested or not) with repayment terms from seven to 15 years. Additionally, Ascent’s law school loan comes with a nine-month grace period after you leave school.
• Citizens: With a Citizens law school loan, you can borrow $1,000 to $225,000 with terms from five to 15 years. Citizens also offers specialized bar study loans from $1,000 to $16,000, which could help you cover your expenses while studying for the bar exam.
• College Ave: With College Ave, you can borrow $1,000 up to 100% of your school-certified cost of attendance (minus any other financial aid you’ve received) with terms from five to 20 years. You’ll also have the option to defer your payments during your clerkship.
• Custom Choice: The Custom Choice Loan is available from $1,000 to $99,999 annually ($180,000 aggregate limit) with a three- or five-year term. Additionally, if you graduate with at least a bachelor’s degree, you could be eligible for a 2% principal reduction.
• EDvestinU: If you have excellent credit, EDvestinU could be a good choice. You can borrow $1,000 up to 100% of your school’s cost of attendance ($200,000 aggregate limit) with terms from seven to 15 years.
• INvestED: Student loans from INvestEd are available to students who live or attend school in Indiana. You can borrow $1,001 up to your school’s cost of attendance (minus any other financial aid you’ve received) with terms from five to 15 years.
• MEFA: With MEFA, you can borrow $1,500 up to your certified cost of attendance with a 15-year term. Keep in mind that you must attend a nonprofit or public university to qualify for a MEFA loan — for-profit schools aren’t eligible.
• Sallie Mae: With Sallie Mae, you can borrow $1,000 up to 100% of your school-certified cost of attendance with a 10- or 15-year term. You can also defer your payments for up to 48 months during your clerkship. Additionally, Sallie Mae offers bar study loans from $1,000 to $15,000 that can help you cover your costs while preparing for the bar exam.