Financing Law School

The high cost of a legal education requires most law students to rely on educational loans to finance at least part of their studies.  Although the best sources of information on possible funding are law schools themselves, this section is an introduction to the financial aid process and some of the resources which may be available to you.  Remember, the earlier you begin researching possible loans and completing both your income tax return and other necessary standardized forms, the more likely you are to secure the necessary funding.

There are several issues to consider before applying for financial aid.

• While federal loan programs for students pursuing graduate and professional degrees   do not require parental financial statements, law schools themselves vary widely in the information used to compute financial aid packages.  Many will request financial information from your parents or others who have provided support for you, even if you have been out of school for a while.
• Significant amounts of consumer debt on credit cards, outstanding debts, or a bad credit rating may affect your ability to borrow money.
• If you are planning to enter a low-paying public interest legal job after completing your J.D., you may want to investigate loan forgiveness programs at some law schools, which assist graduates who take such jobs in repaying law school education loans.

The application process for most forms of financial aid begins with the Free Application for Federal Student Aid (FAFSA), which is available from any college financial aid office or online (fafsa.ed.gov/).  You will need to complete your income tax return for the most recent year before beginning to fill out the FAFSA application.  Law schools may also require you and your parents to apply through the Access Group (accessgroup.org) or the College Scholarship Service Financial Aid Profile (collegeboard.com), which are need analysis services that gather information to determine eligibility for institutional financial aid (scholarships and grants).  Also, schools may have their own financial aid applications.    

There are three types of loans available through either the Federal Direct Student Loan Program (FDSLP) or the Federal Family Education Loan Program (FFELP): 

1. Subdized Federal Stafford Loan–students with demonstrated financial need can borrow up to $8,500 per year; the federal government pays the interest while the student is in school.
2.  Unsubsidized Federal Stafford Loan–students can borrow up to a combined total of $18,500 in subsidized and unsubsidized loans. Students may pay the interest or let it accrue while in school.
3. Perkins Federal Loan–available to students at certain schools only, the amount is determined on an individual basis and the federal government pays the interest while the student is in school.

All of these loans are offered under the same terms;  FDSLP loans, however, are disbursed through individual law school financial aid offices instead of through banks or other traditional lenders. 

The Federal College Work-Study Program is also available to law school students.  Information on private loans offered by specialized lenders such as Law Access, Law-Loans, or The Education Resource Institute (TERI) is available from the financial aid office of any ABA-approved law school, or you can contact Law Access at 1-800-282-1550 or online at www.accessgroup.org, Law-Loans at 1-800-984-0190, or TERI at 1-800-255-TERI.  Although interest rates on loans from private lenders tend to be higher than those offered through federal loan programs, these services offer the advantage of coordinating both federal and private loans through the same lender, if schools are not direct lending schools.

Commercial lenders and financial institutions usually charge the highest interest rates.  It may be beneficial to secure loans through the same lender you used as an undergraduate, eventually consolidating all federal education loans into a single, lower payment.

Merit-Based Aid 

Many law schools and other organizations offer scholarships or grants, monetary awards that do not need to be repaid.  Scholarship decisions by law schools are based on academic merit and/or personal qualifications such as ethnicity, residency, or specific talents.  Check with each school early in the application process for further information, and research funding available through outside organizations at the Cornell Career Services Library.