Ahead Of The Curve: Financial Aid 101

Welcome to Ahead of the Curve, our new series for incoming 1Ls. We’re getting lots of questions about what law school to attend, how to pay for it, and what people can be doing now to set themselves up for success in law school. Stay tuned, and be sure to sign up for our free mailing list and check out the Start Law School Right course to ensure you’re ready to go on Day One!

So you got into law school, but now you need to pay for it. In addition to tuition and other university fees, you have additional costs of textbooks (which cost me close to $2,000 in my first year), travel, boarding, bar prep courses, testing fees, and other expenses that accumulate throughout your legal education. Although each law school sets their own tuition and fees, a legal education costs upwards of $150,000. If you think about this number in context with your undergraduate education or other graduate programs, the amount of debt law school graduates face is rather daunting. In case I haven’t stressed to you enough already, the ABA only allows law students to work 20 hours a week while enrolled in classes. Fortunately, financial aid is still available to law students and you should be able to ease your burden by obtaining and understanding your aid.

What Types of Financial Aid

I know what you’re thinking: Can I really afford law school??? I had a very similar conversation with myself before beginning my 1L year. Even though I had worked full-time 6 months before law school started, I was a first-generation college student and fearful of overwhelming debt. Fortunately, there is financial aid and lots of it. First, there are merit-based scholarships that universities give out based on admission standards. Also, there is federal financial aid that provides students with grants and loans. In order to receive federal financial aid, you must file an FAFSA. (Some universities even require students to get scholarships!) Please note that graduate students are considered independent from their parents when filing the FAFSA. There are also private loans and scholarships available depending on your location and status.

Where’s The Money?

After you file FAFSA, your university takes your information and the amount of federal assistance is populated. Each school is different on timing and availability of loans and other financial aid. Typically, students receive federal aid information during the summer and receive the aid during the first week of classes. However, many universities will allow you to get part of your refund in advance if you need to use it for textbooks or rent. Check with your school’s financial aid office for more information.

Whether or not you will directly receive money depends on what type of loan you have. For federal loans, your university will receive the money first and apply it to your tuition/fees balance. After your account is satisfied, you will receive a refund (typically 3-6 weeks after the start of school). Depending on the loan provider and type of private loan, you can choose whether it goes directly to your university or you.

Figuring Out Loans

Although every student prefers scholarships and grants (financial aid that does not require repayment), loans are the primary form of financial aid that a majority of law students rely upon. The U.S. Department of Education also provides a guide on federal financial aid which will help you set your budget and figure out how much money you should take out in loans. How much you receive from the federal government will determine how much money you may need to borrow from private loan providers.

Loan Repayment

Loan repayment is something all students fear. Repayment depends on who you got your loan from and what type of loan it is. For federal loans, there are three main types of personal loans: subsidized, unsubsidized, and PLUS. Subsidized loans do not accumulate interest until you go into your repayment period. Unsubsidized loans will accumulate interest when your loan is disbursed. PLUS loans accumulate interest and repayment begins at full disbursement.

After you drop below half-time enrollment or graduate, repayment begins. You are given a one-time 6 month grace period (meaning you don’t have to make payments). Note: you may be eligible for a deferment on payments under certain circumstances (e.g. you go back to school). Federal loans offer graduated, extended, and income-driven repayment plans that allow you to change the monthly payments and number of years of repayment in order to best serve students from all different backgrounds. However, you are always allowed to pay back more to your loans per month or even begin paying loans before your repayment period begins.

Private loan providers have their own repayment and interest schedules; check with your personal loan provider or website for more information. The U.S. Department of Education also has a repayment calculator available for students to help ease your repayment trouble.

Financial Aid Issues

Paying for school is stressful. Ensuring you have sufficient money in order to learn can be even more stressful. If you have problems with your university receiving your financial aid information or getting financial aid to you, talk with your school’s financial aid office. However, if you have questions or concerns with repayment and loan disbursement, talk to your loan provider. Ultimately, financing your legal education is an investment that can be made easier by securing financial aid.