Questions regarding Debt Forum

[GFox345]

.

[zozo1717]

You can use the Georgetown Law Financial Aid Calculator: https://www.law.georgetown.edu/admissio ... geid=61621

It doesn't let you adjust for the extra semester the first year, but you can get a rough idea of your monthly payments on different plans.

[GFox345]

I forgot to explain a critical thing. I am doing Summer Start at UMich, and thus my first year will consist of three semesters, my second of the usual 2, and my third year of only one semester. Hopefully that clears things up a bit.

[zot1]

You are assuming that you will get a job at graduation and that that job will be one that will be eligible for the 10 year forgiveness.

Keep in mind that you won't be employed while you study for and take the bar and until your job starts (IF you have a job). And even then, you will likely not get your first paycheck for close to a month after you start working.

If your employer doesn't pay for bar prep cost, you will have to take that into account. The bar prep course and your bar app fees plus other costs can get really up there.

So if you want the bigger picture, you should take these into consideration.

[fliptrip]

Total Debt at Repayment = $85,923 + $53,860 + 25,052 = $164,871

Stafford Debt (68,967)
PLUS Debt (95,945)
Yearly Interest (Stafford) at (68,967) (1.0584) = $4,100
Year Interest (PLUS) at (95,945) (1.0684) = $6,562
~ $10,500 yearly interest first year of repayment

Estimate: $1,800/month for 10 year repayment program

Oh Fox, I'd never do this kind of calculation by hand. Instead use a calculator. The Gtown calculator is usually more than enough, but you have enough unique stuff going on that you should use the lawsomething22 calculator: https://drive.google.com/file/d/0B1AHcF ... sp=sharing

[GFox345]

Total Debt at Repayment = $85,923 + $53,860 + 25,052 = $164,871

Stafford Debt (68,967)
PLUS Debt (95,945)
Yearly Interest (Stafford) at (68,967) (1.0584) = $4,100
Year Interest (PLUS) at (95,945) (1.0684) = $6,562
~ $10,500 yearly interest first year of repayment

Estimate: $1,800/month for 10 year repayment program

Oh Fox, I'd never do this kind of calculation by hand. Instead use a calculator. The Gtown calculator is usually more than enough, but you have enough unique stuff going on that you should use the lawsomething22 calculator: https://drive.google.com/file/d/0B1AHcF ... sp=sharing

Thanks, Fliptrip. I used the G-Town Calculator like Zozo1717 recommended, and I actually came within about 10k of my total debt at repayment and $150 of my month payment. Not terrible, but the calculator provided a more accurate picture with much less effort!

I would be interested to hear what you think about how advisable of a decision this is. According to the Dean of Financial Aid at Michigan last week, this figure is right around the average indebtedness of a Michigan Law graduate, and if they really are using an "average" then it would be easy for the lucky people who graduate with no debt at graduation (~25% of the class from what I've heard) to distort the picture. I imagine that the median may be substantially higher than the mean here.

[GFox345]

You are assuming that you will get a job at graduation and that that job will be one that will be eligible for the 10 year forgiveness.

Keep in mind that you won't be employed while you study for and take the bar and until your job starts (IF you have a job). And even then, you will likely not get your first paycheck for close to a month after you start working.

If your employer doesn't pay for bar prep cost, you will have to take that into account. The bar prep course and your bar app fees plus other costs can get really up there.

So if you want the bigger picture, you should take these into consideration.

I've been pondering these issues for a while. I'm not sure what you mean about the 10-year forgiveness. My calculation was for a 10-year repayment plan. I would not just be paying the interest. I would be paying off the loan. This works out to a payment of about 2k a month, which is very doable if I end up in biglaw. And Michigan's LRAP is good to keep me above water if I don't get Biglaw.

I know that some firms provide bar stipends to those law students that they hire before graduation, but I understand that it is also an assumption that I would get that kind of employment.

Again, these debt figures assume that I borrow the maximum that I am allowed to borrow in federal loans. I still have to get a better sense of what my actual cost of living is going to be given my situation.

[zot1]

You are assuming that you will get a job at graduation and that that job will be one that will be eligible for the 10 year forgiveness.

Keep in mind that you won't be employed while you study for and take the bar and until your job starts (IF you have a job). And even then, you will likely not get your first paycheck for close to a month after you start working.

If your employer doesn't pay for bar prep cost, you will have to take that into account. The bar prep course and your bar app fees plus other costs can get really up there.

So if you want the bigger picture, you should take these into consideration.

I've been pondering these issues for a while. I'm not sure what you mean about the 10-year forgiveness. My calculation was for a 10-year repayment plan. I would not just be paying the interest. I would be paying off the loan. This works out to a payment of about 2k a month, which is very doable if I end up in biglaw. And Michigan's LRAP is good to keep me above water if I don't get Biglaw.

I know that some firms provide bar stipends to those law students that they hire before graduation, but I understand that it is also an assumption that I would get that kind of employment.

Again, these debt figures assume that I borrow the maximum that I am allowed to borrow in federal loans. I still have to get a better sense of what my actual cost of living is going to be given my situation.

Sorry, Fox. That was my mistake. 10 year repayment. I get it now.

My point was that to get a better picture, you should do calculations of as many scenarios as possible: repayment if you get biglaw starting September, repayment in biglaw if you start january, repayment in firm if you start September, or 10 months after graduation, or government, etc etc. I'm only advising this because always assuming best case scenario is one nice way to get yourself disappointed. However, as with any other advice you get, feel free to disregard it if that's what you want.

[fliptrip]

Total Debt at Repayment = $85,923 + $53,860 + 25,052 = $164,871

Stafford Debt (68,967)
PLUS Debt (95,945)
Yearly Interest (Stafford) at (68,967) (1.0584) = $4,100
Year Interest (PLUS) at (95,945) (1.0684) = $6,562
~ $10,500 yearly interest first year of repayment

Estimate: $1,800/month for 10 year repayment program

Oh Fox, I'd never do this kind of calculation by hand. Instead use a calculator. The Gtown calculator is usually more than enough, but you have enough unique stuff going on that you should use the lawsomething22 calculator: https://drive.google.com/file/d/0B1AHcF ... sp=sharing

Thanks, Fliptrip. I used the G-Town Calculator like Zozo1717 recommended, and I actually came within about 10k of my total debt at repayment and $150 of my month payment. Not terrible, but the calculator provided a more accurate picture with much less effort!

I would be interested to hear what you think about how advisable of a decision this is. According to the Dean of Financial Aid at Michigan last week, this figure is right around the average indebtedness of a Michigan Law graduate, and if they really are using an "average" then it would be easy for the lucky people who graduate with no debt at graduation (~25% of the class from what I've heard) to distort the picture. I imagine that the median may be substantially higher than the mean here.

I hate to say this, but I would not trust a single thing a person in law school admissions or financial aid tells you. If that's too extreme, then at least adopt a trust, but verify, stance.

The quoted average indebtedness figure is very tricky (remember, there's lies, damn lies, and statistics). If they are including every Michigan Law grad then yes, the presence of the Darrow folks and the rich folks is going to skew that number downward. I'd see if that figure is the average indebtedness of those who borrowed or of those who graduated Michigan in a single year. But, at this point, how you compare to other folks doesn't mean as much as do your figures work for your planned employment, life goals, and debt tolerance. Are you someone who will hate yourself every day for accruing $100k in debt?

[GFox345]

Total Debt at Repayment = $85,923 + $53,860 + 25,052 = $164,871

Stafford Debt (68,967)
PLUS Debt (95,945)
Yearly Interest (Stafford) at (68,967) (1.0584) = $4,100
Year Interest (PLUS) at (95,945) (1.0684) = $6,562
~ $10,500 yearly interest first year of repayment

Estimate: $1,800/month for 10 year repayment program

Oh Fox, I'd never do this kind of calculation by hand. Instead use a calculator. The Gtown calculator is usually more than enough, but you have enough unique stuff going on that you should use the lawsomething22 calculator: https://drive.google.com/file/d/0B1AHcF ... sp=sharing

Thanks, Fliptrip. I used the G-Town Calculator like Zozo1717 recommended, and I actually came within about 10k of my total debt at repayment and $150 of my month payment. Not terrible, but the calculator provided a more accurate picture with much less effort!

I would be interested to hear what you think about how advisable of a decision this is. According to the Dean of Financial Aid at Michigan last week, this figure is right around the average indebtedness of a Michigan Law graduate, and if they really are using an "average" then it would be easy for the lucky people who graduate with no debt at graduation (~25% of the class from what I've heard) to distort the picture. I imagine that the median may be substantially higher than the mean here.

I hate to say this, but I would not trust a single thing a person in law school admissions or financial aid tells you. If that's too extreme, then at least adopt a trust, but verify, stance.

The quoted average indebtedness figure is very tricky (remember, there's lies, damn lies, and statistics). If they are including every Michigan Law grad then yes, the presence of the Darrow folks and the rich folks is going to skew that number downward. I'd see if that figure is the average indebtedness of those who borrowed or of those who graduated Michigan in a single year. But, at this point, how you compare to other folks doesn't mean as much as do your figures work for your planned employment, life goals, and debt tolerance. Are you someone who will hate yourself every day for accruing $100k in debt?

The figure is the average indebtedness of all students that graduated from Michigan last year, so yes, I believe that the figure is skewed downward. As of right now, my plan is biglaw. I've worked in a Big Firm as a Paralegal, and although I know this doesn't provide an accurate picture of what it's going to be like as an associate, I at least know that I can stand the culture and the hours. Also, I am well-acquainted with the mind-numbingly boring tasks that I will sometimes have to complete as part of my job. Believe me. There is no shortage of this for Paralegals.

That being said, I know that getting Biglaw is an assumption, although I like to think that I have good odds of getting it if I focus on it. In the end, fate will decide. Regardless, I know that a career in law is what I want to do with my life, and I have accepted the debt that I will take on as part of that life path.

I've wanted to ask about Biglaw for some time though. Is getting Biglaw entirely about grades, or do your performance in an interview, work experience, and connections matter significantly in addition to grades?

[Tiago Splitter]

According to US News 76% of Michigan 2015 grads had debt and the average (without interest or origination fees) of only that 76% was $142,572.

Regarding obtaining biglaw, you'll need to be ready to bid heavily on firms in New York City. "Fate" doesn't have much to do with it. If you're ok with that then your chances at biglaw from Michigan aren't bad.

[GFox345]

According to US News 76% of Michigan 2015 grads had debt and the average (without interest or origination fees) of only that 76% was $142,572.

Regarding obtaining biglaw, you'll need to be ready to bid heavily on firms in New York City. "Fate" doesn't have much to do with it. If you're ok with that then your chances at biglaw from Michigan aren't bad.

What the hell kind of a debt figure doesn't include interest or origination fees? That's ridiculous. But thanks for the statistic.

By "Fate" I meant the outcome of my classes, the outcome of my job interviews, etc. I can prepare, but at the end of the day there seems to be an element that I can't control. I just identified that element as fate. Call it whatever you like.

I will take what I can get obviously, but my first choice market it definitely Chicago. I also have a family connection to a large firm in DC. That being said, I will cast a wide net and assume nothing when I comes to landing a Biglaw Job.

[fliptrip]

What the hell kind of a debt figure doesn't include interest or origination fees? That's ridiculous. But thanks for the statistic.

That's easy. The kind of debt figure you want to use to fool someone into thinking he's borrowing less than he really is.

Car salesmen use similar tactics, ya know. They don't tell you about depeciation, maintenance, and financing costs when you go to buy a car. You have to twist their arms to even get them to tell you about taxes!