Law School Student Loans: What You Need to Know

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Student loans are a necessary evil for most law students. Unless you have wealthy parents or scholarships, you will likely need to take out some form of student loan in order to pay for law school. The bad news is that law school student loans come with high interest rates and can be difficult to pay back. The good news is that there are many repayment options available, and there are organizations that can help you navigate the process. In this blog post, we will discuss the different types of law school student loans, repayment options, and ways to get help with your loans.

Different types of loan

First, it’s important to understand the different types of law school student loans available. The most common type is federal student loans, which are funded by the government and typically have lower interest rates than private loans. These come in two forms: Direct Subsidized Loans, where the government pays the interest while you are in school, and Direct Unsubsidized Loans, where the interest accrues while you are in school.

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Private loans, on the other hand, come from banks or private lenders and often have higher interest rates and less flexible repayment options. It’s important to exhaust all federal loan options before taking out private loans for law school.

Repayment options

Once you have graduated and begin to pay back your loans, it’s important to understand the different repayment options available. A standard repayment plan involves fixed monthly payments for up to 10 years. However, there are also income-driven repayment plans, where your monthly payments are based on your income and family size. These plans can also potentially lead to loan forgiveness after a certain amount of time.

It’s important to note that if you are having trouble making payments, there may be options for deferment or forbearance, where your payments are temporarily paused. However, interest will still accrue during this time.

Getting help

Navigating law school student loans can be overwhelming and confusing. Fortunately, there are organizations that can offer guidance and assistance. The American Bar Association offers resources for managing law school debt, and there are also non-profit organizations such as the National Consumer Law Center’s Student Loan Borrower Assistance Project that offer information and advocacy for student loan borrowers. Your law school may also have resources or counseling available.

It’s never too early to start thinking about your law school student loan repayment plan. By understanding the different types of loans and repayment options, and getting help from trusted organizations, you can take control of your law school debt and successfully navigate repayment.

FAQs

What is the interest rate on law school student loans?

The interest rate varies depending on the type of loan and when it was taken out. Federal Direct Subsidized and Unsubsidized Loans were taken out for the 2019-2020 academic year and have a fixed interest rate of 4.53%. Private loans will typically have higher interest rates, but they can vary greatly from lender to lender.

Can I defer my law school student loans while I’m in a graduate program?

It depends on the type of loan and the terms of your deferment. Federal Direct Subsidized and Unsubsidized Loans can often be deferred while you are enrolled in a graduate or professional program, but private loans may not have this option. It’s important to check the terms of your loan and contact your lender for more information.

Can I consolidate my law school student loans?

Yes, you can consolidate federal student loans through the Direct Consolidation Loan program, which can potentially lower your monthly payments and simplify the repayment process. Private loans cannot be consolidated through this program, but you may be able to consolidate them with a private lender. It’s important to carefully consider the terms and potential impact on interest rates before consolidating loans.

What if I can’t afford to pay back my law school student loans?

If you are having trouble making payments, it’s important to contact your lender and explore options such as deferment or income-driven repayment plans. It’s also important to consider seeking legal assistance through organizations such as the National Consumer Law Center’s Student Loan Borrower Assistance Project or your law school’s resources. Defaulting on student loans can have serious consequences, so it’s important to seek help and explore options before letting loans go into default.

Are there government loans for law school?

Yes, federal student loans such as Direct Subsidized and Unsubsidized Loans are available for law school students. It’s important to note that federal loans have borrowing limits and must be repaid, while some private lenders may offer loans with no borrowing limit but may have higher interest rates and may not have options for deferment or income-driven repayment.

Can I have my law school student loans forgiven?

There are limited options for loan forgiveness, such as the Public Service Loan Forgiveness program for borrowers in certain public service jobs or the Income-Based Repayment and Pay As You Earn plans, which forgive remaining loan balances after a certain number of years of consistent payments. It’s important to carefully consider the terms and potential impact on interest rates before consolidating loans. It’s also important to note that loan forgiveness programs can change, so it’s important to stay informed and contact your lender or a trusted organization for updated information.

The bottom line

Navigating law school student loans can be intimidating, but by understanding the different types of loans and repayment options available and seeking help from trusted resources, you can take control of your debt and successfully navigate repayment. It’s never too early to start planning for loan repayment, so don’t hesitate to start researching and seeking guidance. Good luck on your journey toward loan repayment.

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