Private Lenders? Forum

[clint4law]

Has anyone used any private lenders to finance his/her legal education? If so, which lender did you use? I hear Wells Fargo is one of the biggest players in this market. I know rates are variable and based on credit but would like some type of ballpark figure before pursuing it.

[Birdman]

You can borrow grad plus federal loans up to the cost of attendance (tuition + cost of living - scholarships/financial aid). There is no reason to take out private loans for law school.

[clint4law]

You can borrow grad plus federal loans up to the cost of attendance (tuition + cost of living - scholarships/financial aid). There is no reason to take out private loans for law school.

those have a 7.9% interest rate...I have excellent credit and based on current interest rates believe I would be eligible for a much lower rate.

[Birdman]

True you could get a lower rate. But interest rates are variable, if your credit score takes a hit for whatever reason your rates will go up. The grad plus loans have a capped interest rate, private loans don't. Private loans cannot be gotten rid of under any circumstances (except of course paying them off). Federal loans have IBR, etc. It's a gamble that I don't think anyone on here would recommend.

[clint4law]

True you could get a lower rate. But interest rates are variable, if your credit score takes a hit for whatever reason your rates will go up. The grad plus loans have a capped interest rate, private loans don't. Private loans cannot be gotten rid of under any circumstances (except of course paying them off). Federal loans have IBR, etc. It's a gamble that I don't think anyone on here would recommend.

what's IBR?

[missinglink]

Keep in mind, federal programs like IBR don't apply to private loans. If you're worried about paying off future loans, federal loans offer more of a safety net.

http://www.finaid.org/loans/loantradeoffs.phtml

[missinglink]

True you could get a lower rate. But interest rates are variable, if your credit score takes a hit for whatever reason your rates will go up. The grad plus loans have a capped interest rate, private loans don't. Private loans cannot be gotten rid of under any circumstances (except of course paying them off). Federal loans have IBR, etc. It's a gamble that I don't think anyone on here would recommend.

what's IBR?

http://www.ibrinfo.org/

[clint4law]

thanks guys

[darknightbegins]

I also toyed with the idea of private loans as I have a flawless credit history and no undergrad student debt. But generally federal loans do seem alot safer for most people. Unless you have no interest at all following IBR guidelines and are dead set on private practice (in whatever form) then federal loans are likely your best bet. If you are going to a top program, lets say T14 or even T20 and you are dead set on private practice and really think you have a legit shot at 6 figure starting salary, then private loans may be more attractive to you with the lower interest rate.

In the end private loans carry more risk. Depends on your situation and goals though really.

[clint4law]

this is such a difficult decision....I was just approved at Chase for a 3.75% interest rate. Any advice?

[clint4law]

also, for the sake of not getting my FICO run by multiple financial institutions, which private lender has the most aggressive rates and terms? Well Fargo? Citi? Chase?

[Bert]

Private loans cannot be gotten rid of under any circumstances (except of course paying them off).

I just did some research on this (because I thought you could discharge personal student loans in bankruptcy) and you can not discharge personal student loans in bankruptcy -- they are as difficult to discharge as the federal student loans. You learn something new every day.