Getting accepted to law school can bring upon feelings of joy, anticipation, and pride. But once the happiness wanes and reality sets in, many law school students are faced with feelings of stress due to sky-high tuition costs.
Law school is notoriously expensive. According to U.S. News, the average annual tuition and fees at private law schools in the 2019-2020 academic year was $49,548. This figure alone is enough to concern even the most optimistic law student. The costs rise even further when taking into account housing and general living expenses. Many graduates end up graduating with upwards of $150,000 in total student loan debt.
In addition to grueling coursework, many aspiring law students are faced with how to pay for law school. Given the rigorous nature of law school, some students may find it impossible to maintain a job in addition to attending class. Therefore, the answer to paying for law school most likely lies in student loans.
From federal student loans to those offered by private lenders, student loans and other forms of financial aid are the only options for many students when it comes to how to afford law school.
If you are considering taking out student loans to pay for your law school tuition, you may be wondering what the process entails. Here is everything you need to know about how to pay for law school with private student loans.
What is a private student loan?
Private student loans are just one avenue students explore when determining how to afford law school. Law school private loans are those offered by a bank, credit union, or other financial institutions. Private student loans carry different interest rates and repayment terms, depending on whom you borrow from. Some factors lenders will consider when determining your loan eligibility include your credit score, and whether or not you have a co-signer.
How are law school private loans different from federal law school loans?
Private student loans differ from federal school loans in several ways. Federal student loans, for instance, are offered by the government on a fixed rate which is determined by Congress each year. Private student loan rates, on the other hand, are determined by each individual lender’s eligibility criteria – the most important typically being credit score.
One of the biggest differentiators between private student loans for law school and federal loans for law school is their repayment terms. Private loans may entail payments as you are attending school, or may be deferred until you secure employment after graduation.
There are typically four different repayment options when dealing with law school private loans. These include:
- Immediate repayment
- Interest-only repayment
- Partial interest repayment
- Full deferment
On the other hand, federal student loans have about twice as many repayment options. These include income-driven repayment plans. Income-driven repayment plans take into account how much money you are making once you graduate, which will determine how big your payments are and how long you have to pay off your loan.
If you decide to take out a federal student loan, you’ll most likely be dealing with one of the following once you graduate:
- Standard Repayment Plan
- Graduated Repayment Plan
- Extended Repayment Plan
- Revised Pay As You Earn Repayment Plan (REPAYE)
- Pay As You Earn Repayment Plan (PAYE)
- Income-Based Repayment Plan (IBR)
- Income-Contingent Repayment Plan (ICR)
- Income-Sensitive Repayment Plan
Can private student loans help fund law school tuition?
Private student loans for law school are an excellent option for funding tuition. Though, once you graduate, you’ll need to begin repaying what you owe, as well as the interest that has accumulated. This is why securing a fair interest rate is crucial when taking out private student loans for law school.
Unfortunately, not everyone qualifies for a low interest rate. There are many reasons for this. Whether due to a low credit score or no credit history at all, there’s no guarantee lenders will offer you a low rate when you decide to borrow without a cosigner.
There is hope upon graduation, though. If once you graduate you realize your loan repayment terms or interest rate are less than desirable, you have options. One thing many law school graduates consider is student loan refinancing.
Once you secure employment, lenders may be more willing to work with you to secure a lower rate. Student loan refinancing is just one way to lower your interest rate and ultimately save money throughout the course of your loan.
There are other benefits, too. By refinancing, you may be able to pay off your student debt more quickly, which provides more room for discretionary spending. Refinancing may even be able to help you grow your savings quicker, resulting in a healthier financial future.
Compare private student loan rates to find the best deal
Securing fair student loan interest rates requires research and shopping around to find the best rate and terms for you.
This process is made quick and simple with Purefy’s Compare Rates tool. With just one easy form, you’ll see a variety of rates and terms from different lenders – all at once and in once place.
Once you determine your best rate, you can apply through your lender of choice in under 15 minutes.
Figuring out how to pay for law school is a struggle for thousands of students each year. With nearly 7 out of 10 students looking to student loans to fund their education, it’s no wonder the topic has become of such interest. While you have numerous options when it comes to loans, this is not a financial issue to be taken lightly. By carefully comparing the pros and cons of private student loans and those offered by the government, you’ll be well equipped to make decisions that set you up for success.