You’re ready to take the next big step in life and pursue your JD. You’ve probably worked incredibly hard to keep your grades up all through undergrad. Or, you’ve worked for a few years after graduating to build up some experience in the field. Then, you went through the tenuous process of researching, comparing, and choosing the right law program for you–not to mention taking the LSAT, applying and getting accepted. All of these things are incredible achievements and you’re excited to become a lawyer someday. But, then you realize there’s just one thing left to figure out: How the heck am I going to pay for this? That’s where law school loans come in.
If you’re at this stage of the process and getting ready to enroll in law school, then you already know that it’s an expensive proposition. It’s not uncommon for law school graduates to take on more than $100,000 in debt over 3 years. Or, to graduate with more than $200,000 total debt including the cost of an undergraduate degree.
Luckily, law school graduates are also in high demand and have high lifetime earning potential. That means there are many companies willing to help students finance the cost of earning a JD.
Many students use federal loans and law scholarships to finance their education. However, students are increasingly using private lenders for more competitive rates and terms. Which law school loans are right for you will depend on your circumstances.
Federal Student Loan Options
The U.S. Department of Education issues millions of dollars in student loans each year. Through their various programs for undergraduate and graduate students, they offer loans to all kinds of students pursuing varying levels of education.
As a law student, the programs available to you would be:
William D. Ford Federal Direct Loan (Unsubsidized)
- Up to $20,500 per year
- Current interest rate: 6.08%
- Origination fee: about 1%
- No credit history check or cosigner
- Up to the full cost of attendance of your college
- Current interest rate: 7.08%
- Origination fee: about 4.3%
- Requires “no adverse credit history”
- May require a cosigner
For many students heading to law school, it would be possible to finance the entire education through these two types of loans (depending on additional living expenses/housing costs that may arise).
But, that doesn’t mean that is the right choice for every student. While federal loans are likely the most popular choice–and they offer some great benefits–they also have some drawbacks that may make them less appealing to some borrowers.
Benefits of federal loans
- No credit requirements for Federal Direct loans
- Deferment and forbearance protections
- Income-based repayment programs available
Drawbacks of federal loans
- National yearly interest rate
- Little flexibility on repayment terms
- No ability to include private loans
- Loan origination fees
Private Student Loan Options
Outside of federal loan options, there are also a number of private lenders that help students fund their education.
These include long-standing lenders such as Sallie Mae, Bank of America, Discover, and others, as well as new entrants, like College Ave and local/regional credit unions and banks around the country.
Many students pursuing graduate or professional degrees will look to private lenders because they tend to offer competitive market rates. Additionally, many lenders take into account the potential lifetime earnings of the borrower–which would be good for future lawyers–when evaluating credit.
Some private lenders also offer more flexible repayment terms, with the option to select a specific loan duration in months, rather than having to choose from just 10, 15, or 20-year loans.
Although some lenders offer unemployment protection and other benefits to borrowers, not all do, and they generally are not as extensive as those offered through federal loan programs.
Benefits of private lenders
- Generally offer more-competitive, market interest rates
- Lenders may offer additional flexibility on repayment terms
- Rates are based on creditworthiness and not set the same for all borrowers
Drawbacks of private lenders
- Will require a credit history check
- May require a cosigner
- Not all lenders offer borrower protections
The Best Student Loan Companies for Law School Students
Compare rate offers from about 8 lenders
|1.04%* + variable APR|
3.30%* + fixed APR
|5 - 15, 20 years||Undergrad & Grad||LEARN MORE ›|
|1.13% - 11.23% variable APR|
3.50% - 12.60% fixed APR
|5, 10, 15 years||Undergrad & Grad||LEARN MORE ›|
*APR includes a 0.25% interest rate reduction for enrollment in automatic payments.
If you’ve chosen to use a private lender, it’s important to know that not all companies are created equal. Not only will different lenders offer different rates and terms based on your credit history, but there are also matters of borrower protections (e.g., unemployment), customer service, and other factors that matter when choosing a lender.
We’ve chosen our two favorite companies for finding the best lender for you. Both Credible and LendKey offer a way for you to quickly and easily compare lender rates–without performing a hard credit check.
This will also give you more options to shop around and more knowledge to compare offers without having to run from bank to bank.
Use College Raptor’s free Student Loan Finder to compare lenders and interest rates side by side!