A legal education is both an investment in a student’s future and a financial investment. Like all investments, before you apply for any student aid, considering the pros and cons of a massive expenditure of money, time, and effort is essential. A realistic assessment of the reasons to pursue a legal education and how to pay for it is crucial.
The best source of legal education financial aid information is the website or financial aid office of a LSAC-member law school. LASC.org has several good financial aid information sources and links to numerous law schools and need-based financial aid. The cost of law school (which is typically 3 years) can exceed $150,000.
The yearly tuition ranges from several thousand dollars to more than $50,000. The total cost of law school attendance includes transportation, housing, food, books, and personal expenses. Law schools establish a ‘Cost of Attendance’ that provides for allowances for living expenses and fixed costs of fees and tuition.
That Cost of Attendance is the maximum financial aid available from any source. Education loans are the primary—but not the exclusive—source of financial assistance for the majority of law school students.
Loans are repaid with future income. The more money that is borrowed, the longer the debt impacts life after graduation. Federal student loans offer the most flexible payment options. Those options include Income-Driven Repayment (IDR) plans.
IDR plans offer monthly payments that are less than ten percent of the monthly household
Adjusted Gross Income (AGI). There are more payment relief opportunities available from federal loans than those offered by institutional or private source loans.
Institutional and private loan sources are typically used by students ineligible for federal student loans. The school’s financial aid staff determines the types and amount of loan funding a student is eligible to receive based on the school’s cost of attendance, institutional policies, and federal regulations.
Guidelines for borrowing law school loans include:
- Borrowing the minimum needed.
- Seeking federal loans first.
- Avoiding loans from private sources unless ineligible for federal student loans.
Other Sources Of Funding
There are limited fellowships, grants, and scholarships available. Some students in their second and third year of law school are offered part-time Federal Work-Study Program employment. There is an ABA-mandate that limits the number of hours that full-time law students can work. First-year students are expected to concentrate fully on schoolwork.
Rules and regulations are continually changing and law school policies vary. The student must stay current about financial aid. The research is similar to that done when deciding to which law school to apply. All professional and graduate school students are thought to be financially independent of parents for determining federal aid eligibility.
Submitting parental information is not a requirement. Law schools may require financial information of parents for institutional scholarships and grants. Students need to be aware of specific procedures and policies regarding independent status for institutional funds allocations. The guidelines vary from school to school. Students should investigate the guidelines for all schools they have an interest in attending.
Negotiating Law School Financial Aid
Loan forgiveness programs are becoming more and more popular. Law schools ask students to take out loans that will finance most of the legal education. After graduation, schools look at what a student is earning. The schools repay all or part of tuition debt for students earning below a certain threshold. What that means is, those who are looking for significant need-based financial aid for law school will likely be unsuccessful.
Those individuals should focus on merit-based awards to earn financial grants used to defray the high cost of legal education. Anyone who enters law school with financial need and does not secure a merit-based award will be strapped with loans. Institutions facilitate federal loans such as Perkins and Stafford loans. If a student’s financial need exceeds the federal limit, students take out private loans from either a lender of choice or the school’s preferred lender.
This route means after graduating law school; a student has significant debt. Those taking a public sector or public interest job traditionally earn a low salary. In that situation, law schools will probably repay at least part of the loans for the next ten to 15 years. That repayment is subject to the law school forgiveness program details and the continued financial need for that ten- or 15-year period.
Those hired by top law firms, with a starting salary of $160,000, will not receive help in repaying loans, even if the student was in significant financial need when entering law school. Planning is critically important. Students need to know what funds are available before and after graduation.
Securing need-based aid early in law school is becoming less and less of a viable option. Paying back loans can be minimized by focusing on merit-based aid therefore, you should apply to schools with a reputation for offering significant merit-based assistance.
The negotiating process is delicate. The student must be careful in communicating with law schools about merit-based offers. The right approach can save five and six-figure amounts in interest and tuition. Getting a $10,000 grant or $10,000 to $30,000 off tuition makes a monumental difference in the cost of law school, even over a repayment period of ten or 15 years. It’s well worth spending the time to find grants like these and save later on.