Columbia Law at full sticker price? Forum

[itsallgood_man]

I was wondering what you guys thought, if you got into Columbia but you'd have to pay full price (on top of your UG loans) would you do it? Would'nt this debt get in the way of owning your own home?

[BillingMeSoftly]

YOLO!!! Retake

[Vandy2bforrealz]

I would do it only if my goal was NYC Biglaw and no other top school gave me a solid offer.

[the_murray]

Definitely. No UG student loans, live at home near the school to offset living costs, it would be a no-brainer.

[californiauser]

No school is worth 250k debt. If you get into CLS, you should get scholarship offers from other T14s.

[rpupkin]

On the one hand, the answer to you question is "no." On the other hand, the answer to your question is "no." Or, to put it another way: No.

Seriously OP, this is a really bad idea. Take a substantial scholarship from a different school (or, if you don't get a substantial scholarship, retake or don't go to law school at all).

[fliptrip]

It's not that Columbia isn't worth sticker in the same way Michigan isn't worth sticker, it's that you can get substantially similar payoffs to Columbia by going to other schools that will be cheaper. So, barring some exceptional circumstances, one should not take CLS at sticker.

[rpupkin]

It's not that Columbia isn't worth sticker in the same way Michigan isn't worth sticker, it's that you can get substantially similar payoffs to Columbia by going to other schools that will be cheaper. So, barring some exceptional circumstances, one should not take CLS at sticker.

But it really isn't that different. Here's the thing 0Ls don't seem to get: If you take on $300K in debt, you will need to work in big law for at least 6-7 years in order to pay that debt off. Do you know how many law grads actually end up staying and thriving in big law for that long?

So, yes, CLS gives you a somewhat better chance at landing big law than Michigan does. But even if you get big law, it is still very likely going to be a bad outcome when you're saddled with hundreds of thousands of dollars of debt. The chance that you will remain in (and enjoy) big law for 7 years is about the same as the chance that you will finish in the top 5-10% of your class at a T14. TLS justifiably mocks those who make that assumption. It should also mock those who assume that they won't be miserable for 7+ years in big law.

OP: Avoiding significant debt is crucial to your future happiness. You do not want to be a second-year associate in NYC thinking that you must put up with the lifestyle for another several years just to break even.

[Vandy2bforrealz]

Op you need a poll.

[fliptrip]

Op you need a poll.

LOL, here's the poll:

Is CLS worth sticker?

Yes: 5%
No: 95%

[krads153]

It's not that Columbia isn't worth sticker in the same way Michigan isn't worth sticker, it's that you can get substantially similar payoffs to Columbia by going to other schools that will be cheaper. So, barring some exceptional circumstances, one should not take CLS at sticker.

But it really isn't that different. Here's the thing 0Ls don't seem to get: If you take on $300K in debt, you will need to work in big law for at least 6-7 years in order to pay that debt off. Do you know how many law grads actually end up staying and thriving in big law for that long?

So, yes, CLS gives you a somewhat better chance at landing big law than Michigan does. But even if you get big law, it is still very likely going to be a bad outcome when you're saddled with hundreds of thousands of dollars of debt. The chance that you will remain in (and enjoy) big law for 7 years is about the same as the chance that you will finish in the top 5-10% of your class at a T14. TLS justifiably mocks those who make that assumption. It should also mock those who assume that they won't be miserable for 7+ years in big law.

OP: Avoiding significant debt is crucial to your future happiness. You do not want to be a second-year associate in NYC thinking that you must put up with the lifestyle for another several years just to break even.

Agreed

Also if you already have undergrad debt, you shouldn't be paying anything for law school...most of us who went to law school didn't have any undergrad debt

Just for perspective, here's the average debt loads out of law school (see the link below). Just looking at the T-14, it's like 30% didn't have any debt at all, and the majority of people who had debt had debt loads under 150k total. Just based on a very quick glance only two T-14s (correct me if you guys see others) have average debt loads (of people who have debt) over 150k -- Columbia and Northwestern and those debt loads are at like 160k. I don't get why TLSers think that "everyone is taking out sticker/tons of of debt" for law school - because practically nobody is taking out sticker debt for law school. I think TLS just self-selects for a lot of broke people to be honest - the vast majority of people are not taking out sticker debt and approximately 30% at T-14 are getting fully funded by parents/scholly.

http://grad-schools.usnews.rankingsandr ... t-rankings

[Tiago Splitter]

Just for perspective, here's the average debt loads out of law school (see the link below). Just looking at the T-14, it's like 30% didn't have any debt at all, and the majority of people who had debt had debt loads under 150k total. Just based on a very quick glance only two T-14s have average debt loads (of people who have debt) over 150k -- Columbia and Northwestern and those debt loads are at like 160k. I don't get why TLSers think that "everyone is taking out sticker/tons of of debt" for law school - because practically nobody is taking out sticker debt for law school.

http://grad-schools.usnews.rankingsandr ... t-rankings

Those totals don't include interest or origination fees. They're also for the people who started in 2012.

OP Columbia has higher tuition than anyone else and is right at the top with cost of living. When you consider that on top of scholarship differences you'll typically have at other T-14 schools, it's tough to justify without a Hamilton or free living in NYC.

[krads153]

Just for perspective, here's the average debt loads out of law school (see the link below). Just looking at the T-14, it's like 30% didn't have any debt at all, and the majority of people who had debt had debt loads under 150k total. Just based on a very quick glance only two T-14s have average debt loads (of people who have debt) over 150k -- Columbia and Northwestern and those debt loads are at like 160k. I don't get why TLSers think that "everyone is taking out sticker/tons of of debt" for law school - because practically nobody is taking out sticker debt for law school.

http://grad-schools.usnews.rankingsandr ... t-rankings

Those totals don't include interest or origination fees. They're also for the people who started in 2012.

OP Columbia has higher tuition than anyone else and is right at the top with cost of living. When you consider that on top of scholarship differences you'll typically have at other T-14 schools, it's tough to justify without a Hamilton or free living in NYC.

Where does it discuss excluding origination fees/interest?

Regardless, like 30% of the T-14 doesn't have any debt (thank you parents and schollies) and even with origination fees/interest, it's nowhere near 300k or whatever the cost is these days.

[Tiago Splitter]

Where does it discuss excluding origination fees/interest?

Regardless, like 30% of the T-14 doesn't have any debt (thank you parents and schollies) and even with origination fees/interest, it's nowhere near 300k or whatever the cost is these days.

Campos always talks about how those numbers get calculated and they don't include origination fees, interest or undergrad debt. But I agree that a lot of people mistakenly see "successful lawyers" and assume they survived paying top dollar for law school. Someone paying full sticker price ten years ago at CLS could have easily come out with under 200k debt and as you note a significant number of people would have borrowed much less than that.

[Paul Campos]

Schools report the loan totals disbursed through their financial aid offices. Those totals don't include accumulated interest or origination fees. They also don't include private loans, HELOC draw downs, undergraduate debt etc. Also the reported debt totals are averages. If the average loans disbursed at CLS for the class of 2015 were $165K, the average law school debt those people are carrying is around $200K, which means that quite a few people are in the $250K-300K range. BTW the 30% of CLS grads without any debt are almost exclusively rich kids, as only about 10% of the class is getting even half off tuition, plus of course it costs a fortune to just live in Manhattan. On top of all that, CLS now costs quite a bit more than it did in 2012.

[fliptrip]

^^ So, people are indeed borrowing a ton of money to go CLS. I think if anything, veteran TLSers don't consider just how many ill-informed people are out there signing up to pay ridiculous sums at Columbia or places like it because it's an Ivy league school.

[rpupkin]

^^ So, people are indeed borrowing a ton of money to go CLS. I think if anything, veteran TLSers don't consider just how many ill-informed people are out there signing up to pay ridiculous sums at Columbia or places like it because it's an Ivy league school.

People are also borrowing ridiculous sums of money to attend Chicago, NYU, UVA, Berkeley, NU, GULC, etc. I don't think CLS's "Ivy League" designation has much to do with anything.

[krads153]

Schools report the loan totals disbursed through their financial aid offices. Those totals don't include accumulated interest or origination fees. They also don't include private loans, HELOC draw downs, undergraduate debt etc. Also the reported debt totals are averages. If the average loans disbursed at CLS for the class of 2015 were $165K, the average law school debt those people are carrying is around $200K, which means that quite a few people are in the $250K-300K range. BTW the 30% of CLS grads without any debt are almost exclusively rich kids, as only about 10% of the class is getting even half off tuition, plus of course it costs a fortune to just live in Manhattan. On top of all that, CLS now costs quite a bit more than it did in 2012.

I doubt many are taking out private loans since it's hard to get them unless you have a secured loan. This is anecdotal, but pretty much nobody I knew in law school had undergrad loans. If you have undergrad loans, you are doing it wrong. But yes, based on this information, it looks like people are taking out 200k or so in loans on average at CLS for this year class year, which is already irresponsible.

I'm not surprised the 30% without debt is mainly rich kids. I went to a lower ranked T-14, and I'd estimate around 30% of my class was rich/trust fund. A lot didn't even plan on using their degree in the long term - they just went because parents thought it was prestigious and/or versatile (lol).

[fliptrip]

On top of all that, CLS now costs quite a bit more than it did in 2012.

Since we are here, Professor, why is CLS' tuition $63k? I looked at their 509 reports and I see some clear trends that would suggest higher tuition. Their enrollment has declined at an annualized rate of -2.6% while their full time faculty has gone up by 7.6%. Looking at it like that, it is surprising that CLS' tuition hasn't gone up more than the annualized 3.5% it has gone up. Just doing some more back of the envelope calculations, it doesn't look like they are throwing off that much surplus revenue, which was very surprising to me considering what we've come to believe about greedy law schools. Do you know what percentage of revenues a school like CLS is expected to contribute to the central university?

Also, I was trying to think about CLS' sources of revenue, as I am almost certain the central university is not subsidizing them. There's obviously tuition revenue, endowment revenue (CLS' endowment is $280m), and I assume some ancillary revenue from conferences/facility rentals, etc. Is there any other way law schools make money?

[jbagelboy]

There are a lot of people who debt finance all or nearly all of tuition at CLS. I personally think it's a mistake, but given how many of my friends did it and seem pretty comfortable with the decision, I'm torn. All I know is, I took out about ~140,000 in loans to attend law school (pre-interest), and it makes me hate myself and drags me down each day. So $310,000 in loans, I just cannot imagine. It would be a totally different mindset. Paying off loans is a lifelong project there, not something you uncomfortably stomach for a couple years.

One difference between loans at CLS/HLS/Chicago/ect is that you don't bear the same risk of being completely fucked by massive debt and no prospect for employment, since nearly everyone at these schools can earn a high salary if they want one. That's not a justification for the debt, but it is a real distinction.

[abl]

Here's the thing 0Ls don't seem to get: If you take on $300K in debt, you will need to work in big law for at least 6-7 years in order to pay that debt off. Do you know how many law grads actually end up staying and thriving in big law for that long?

I think that's wrong.

$300,000 in debt on a 15-year payoff schedule at 5% fixed (e.g., assuming you refi with reasonable credit) requires $2,400/m in payments. The question is: how much do you need to make to be able to afford $2,400/m in student loan payments?

Let's further assume that you buy a $300,000 house (with a 30-year 4% fixed rate mortgage). That gives you $1,400 in additional mortgage debt each month.

Now, let's throw in another $200/m in misc debt payments each month on top of that. Maybe you have credit card debt or car payments. Whatever -- it doesn't really matter.

That gives you $4,000/m in debt payments. The industry-standard debt-to-income ratio is 43% (or 36% for the cautious). That means that the industry thinks that you're a safe bet to be able to pay off your debt so long as it does not comprise more than 43% (or 36%) of your total gross monthly income. If your debt is $4,000/m, that means you'll have to make more than $111,000/year (43% DTI) or $133,000/year (33% DTI) in order to be able to reasonably service that debt.

Remember: this assumes that you (a) don't pay down any extra debt while in biglaw; (b) buy a $300,000 house; and (c) have a little bit of additional debt on top of your student loans and mortgage. Nevertheless, this indicates that conservatively speaking you can graduate with $300,000 in debt, buy a reasonably nice house, and expect to be able to pay off your debt in 15 years so long as you make more than $111k (or $133k) a year. I think most folks' post-biglaw jobs start at more than that. (Midlaw and in-house jobs--probably the two most common post-biglaw positions--start in the $130k-$150k range.)

Would this path entail riches and luxury? No (at least not for the first fifteen years). But is it a feasible financial path to take? Absolutely.

[rpupkin]

Let's further assume that you buy a $300,000 house (with a 30-year 4% fixed rate mortgage). That gives you $1,400 in additional mortgage debt each month.

I'm sorry, but where does a NYC big law associate (or a big law associate in any major market) buy a house for $300,000? It is absurd to assume that a major-market big-law associate will have housing expenses of only $1,400/month, regardless of whether the associate is buying or renting.

[Olliedemars]

Let's further assume that you buy a $300,000 house (with a 30-year 4% fixed rate mortgage). That gives you $1,400 in additional mortgage debt each month.

I'm sorry, but where does a NYC big law associate (or a big law associate in any major market) buy a house for $300,000? It is absurd to assume that a major-market big-law associate will have housing expenses of only $1,400/month, regardless of whether the associate is buying or renting.

Yup. I own a house that costs less, in a smaller city, and lord knows my mortgage is higher. Never saw a cheaper rent than that in a larger city that wasn't a 1 bedroom. $1400 isn't a good estimate.

[Paul Campos]

On top of all that, CLS now costs quite a bit more than it did in 2012.

Since we are here, Professor, why is CLS' tuition $63k? I looked at their 509 reports and I see some clear trends that would suggest higher tuition. Their enrollment has declined at an annualized rate of -2.6% while their full time faculty has gone up by 7.6%. Looking at it like that, it is surprising that CLS' tuition hasn't gone up more than the annualized 3.5% it has gone up. Just doing some more back of the envelope calculations, it doesn't look like they are throwing off that much surplus revenue, which was very surprising to me considering what we've come to believe about greedy law schools. Do you know what percentage of revenues a school like CLS is expected to contribute to the central university?

Also, I was trying to think about CLS' sources of revenue, as I am almost certain the central university is not subsidizing them. There's obviously tuition revenue, endowment revenue (CLS' endowment is $280m), and I assume some ancillary revenue from conferences/facility rentals, etc. Is there any other way law schools make money?

I don't know what CLS's endowment is, but it's safe to say that it's a whole lot more than $280 million. The latter figure is from 2000, and Columbia University's total endowment has more than doubled since then, so I would imagine the law school's endowment is at least $600 million (this would throw off about $25 million per year in expendable income).

CLS has expanded its faculty massively in the last five years, from 124 to 178 between 2010 and 2015. Columbia also has an enormous LLM program. 294 students were enrolled in it in 2013, which is the latest year for which figures are available.

Law school financials are tricky, because universities charge law schools for "indirect expenses" (university expenses that aren't incurred directly by individual schools or colleges, such as central administration, health services, campus security etc.) Indirect expenses can be manipulated to be a kind of tax, that goes beyond the school's fair share of actual general university operating costs.

Many law schools used to be cash cows for their home universities, because they would be required to turn over surpluses beyond operating expenses that were greater than legit indirect expense surcharges. But law schools have spent so much money in recent years, justifying these expenditures because of rankings wars, that few if any law schools are actually producing surpluses for their home universities any more. In fact at present the large majority are being subsidized, because of the 30% decline in enrollment.

I doubt CLS is being subsidized though, despite a massive operating budget. But I haven't tried to crunch the numbers. Tuition next year will probably be $65,000, and it's hard to see how you could lose money charging that, though they certainly seem to be making their best efforts to do so.

[abl]

Let's further assume that you buy a $300,000 house (with a 30-year 4% fixed rate mortgage). That gives you $1,400 in additional mortgage debt each month.

I'm sorry, but where does a NYC big law associate (or a big law associate in any major market) buy a house for $300,000? It is absurd to assume that a major-market big-law associate will have housing expenses of only $1,400/month, regardless of whether the associate is buying or renting.

Why are we assuming NYC? $300,000 is well above the national average price for homes, and is an absolutely reasonable amount to expect to pay for a nice 2-3 br apartment in a nice neighborhood in Chicago.

Regardless, I was actually running the numbers for a $300,000 mortgage--which is what you'd need on a $330,000-360,000 place (which gets you into "luxury apartment" territory in a city like Chicago). And bumping that number up to, say, $400,000 (e.g., the mortgage for a $440,000-480,000 house), you still end up needing a salary of only $125,000/$150,000 (43%/36% DTI). So what that means is that with $300,000 in student loan debt, speaking conservatively, things don't start really getting financially unfeasible until you're thinking about buying close to a half a million dollar house.