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Loans

 

Forms
Budget Appeal for the 2012-2013 Academic Year   (Note: All supporting documents/receipts must be photocopied onto 8.5"x11" paper.)

 

 

Loans are the principal source of aid available to law students to fund their education. Loans with the most favorable terms are always made available first to offset student financial need. The majority of educational loans are provided by the federal government.

Only U.S. citizens and permanent residents are eligible to receive federal student loans. Please note that if you are not eligible for federal or private educational loans, neither Berkeley Law nor the University of California, Berkeley will be able to provide you with an institutional loan.

 

Applying for Loans

To submit a general application for federal loans, the following are required:

 

The UC Berkeley Financial Aid Office will provide detailed information about the Direct Loan application process in the Loans section of your BearFacts account. Perkins Loan borrowers will receive email instructions on application requirements once they have accepted all of part of their Perkins offer. Private Loan application requirements vary by lender. Please contact the lender directly for application information. For more information on the timeline for applying for loans, see our entering student checklist or continuing student checklist.

The priority deadline for the FAFSA is March 2. If you miss the deadline, you may still submit your applications keeping in mind these general rules:

  • Stafford Loans take roughly two weeks to process after we receive your FAFSA.
  • GradPLUS Loans require a credit check and can take roughly three weeks to process.
  • Additional time may be required if your MPN or Entrance Counseling is delayed or incomplete.
  • The campus stops processing loan applications about one month before the end of the spring semester for that academic year.

Students applying for loans during the academic year must therefore plan to submit their applications one month before they need the disbursement and at least two months before the end of the spring semester for that academic year.

It is your responsibility to abide by each loan's individual timeline and to stay informed of any changes.

 

Accepting and Modifying Your Loans

In order to receive your loans, you must accept the amount you wish to borrow through the online Offer Letter at MyFinAid. Each loan will be disbursed in two equal payments minus the loan origination fee, half for fall and half for spring. Please allow at least two or three weeks for the disbursement of the accepted loan, providing all administrative requirements are complete. If you expect to use loans to assist in paying your fees, it is recommended that you accept the loan(s) by the beginning of July prior to the beginning of the fall term. Any financial aid awards you receive subsequent to your initial offer will reduce your eligibility for loans. If the loan has paid, you may be billed for the difference.

 

Budget Appeals

Students whose financial aid budgets do not reflect their actual costs may submit a budget appeal to increase costs for additional loan eligibility. Allowable costs include relocation expenses for the first year ($3,000 maximum), greater-than-average rent and utilities ($6,939 maximum), computer purchase for law school ($3,000 maximum and purchase can be no earlier than July), uninsured medical and dental expenses ($5,000 maximum), and greater-than-average child care expenses ($1,000 per child/month maximum). Budget Appeal Forms are available on our Forms page by the end of August and should be submitted to the Berkeley Law Financial Aid Office. 
 

Loan Options

 

  Federal Direct Unsubsidized Federal Direct Perkins Federal Direct Grad PLUS Private Educational Loans University Bar Study Loan
 Restrictions (other than citizenship requirement)  none  Offered to some first year non-residents  Subject to credit check  Subject to credit check  Limited number of loans to graduating 3Ls
 Interest Rate  6.8% fixed  5.0% fixed  7.9% fixed  varies  8.0% fixed
 Maximum Loan Amount  $20,500  $4,000  Student budget minus other aid offered  Student budget minus other aid offered  $4,200
 Grace Period  6 months  9 months  6 months  Usually 6-8 months  8 months
 Interest accrues while in school  Yes  No  Yes  Sometimes  n/a
 Eligible for IBR  Yes  No  Yes  No  No
 Eligible for PSLF  Yes  No  Yes  No  No
 Eligible for LRAP  Yes  No  Yes  Yes  Yes

 

 

William D. Ford Federal Direct Unsubsidized Stafford Loans

A maximum of $20,500 per year is available. Interest accrues on the unsubsidized Direct Ford Loans during periods of enrollment and continues through repayment, which begins six months following graduation or after a student’s enrollment status drops to less than half-time. Repayment is made over a 10-25 year term with no prepayment penalty. 

In August 2011, Congress passed the Budget Control Act of 2011, which included two major changes for graduate and professional school students:

  • The in-school subsidy for Federal Direct Loans is no longer available.
  • The up-front origination fee rebate on all Federal Direct Loans and Federal GradPLUS loans was eliminated. This essentialy changes the origination fee from 2.5% to 4%.

The changes go into effect on July 1, 2012 and affect all Federal Direct Loans for graduate and professional students for the 2012-13 academic year and beyond. Click here for details.

 

Perkins Loans

The UC Berkeley campus offers Federal Perkins Loans to only some students (primarily non-resident first-year students). This loan is interest-free until nine months after graduation or after the student drops to less than six units. At that time interest begins to accrue at 5 %. A separate promissory note and entrance loan counseling must be completed for this loan before a payment can be made. If your financial aid award includes a Perkins Loan, the instructions for completing the promissory note and entrance loan counseling will be e-mailed to you by the campus once you accept a portion of the loan. The e-mail will contain information on accessing the required Promissory Note and Entrance Interview for this loan.

 

Graduate PLUS Loans

Students who need to borrow funds beyond the Federal Direct Stafford and Perkins loan limits will be able to choose between the federal Graduate PLUS Loan ("Grad PLUS") and a private educational loan.

Sample Grad PLUS Loan Offer

$73,886 Student Budget
-$1,000 Scholarship
-$5,000 Need-Based Grant
-$20,500 Direct Stafford Loan
=$47,386 Grad PLUS Loan

 

With a Grad PLUS Loan of $47,386 the sample student would receive a disbursement in their CARS account of $22,782 in August (half of the loan minus origination fee) and $22,782 in January.

 The Direct Grad PLUS being offered at UC Berkeley has a fixed interest rate of 7.9 % and no annual or aggregate borrowing limits (other than cost of attendance less other financial aid received). While credit checks are required to be eligible for the Grad PLUS, the credit criteria are less strict than those associated with private student loans. Furthermore, if you do not meet the credit requirements for a Grad PLUS, you may still obtain the loan with an endorser who does meet the credit requirements.

We encourage you to determine how much money you will need for the academic year and take out as little as possible to reduce your debt burden upon graduating. If you accept less than the maximum amount offered to you, you have until late April of the spring semester to accept additional amounts of the loan. We are available to assist you in determining the appropriate amount of loan to borrow.

All Federal Graduate PLUS loans have a 4% origination fee deducted from the loan amount. The amount of the fee can be added to the loan total to compensate for the deducted fees. If you decide to borrow the maximum Graduate PLUS loan, you may wish to increase the amount you borrow to make up for the fees. To request that the loan fee be added to the Grad PLUS loan total, send an email to financial-aid@law.berkeley.edu BEFORE you accept the award online.

 

 

Private Educational Loans

Although we encourage students to take advantage of the Grad PLUS loan instead of a private educational loan, we make both types of loans available to our students. To apply for a private educational loan, submit an application with the lender of your choice and notify our office of your pending application. You may use any lender, but we suggest that you compare their loan terms with those on our Preferred Lender List. Maximum eligibility is based on the cost of attendance less other financial aid received as reflected on your financial aid offer letter. If you have questions about your eligibility for a private loan, send an email to financial-aid@law.berkeley.edu. Private loan funds are disbursed electronically from lenders to the UC Berkeley campus and applied to a student's CARS account beginning in early August for the fall term and early January for the spring term.

 

University Bar Study Loans

We offer a University Bar Study Loan to graduating 3Ls to help offset the costs associated with taking the bar exam. The loans are designed to cover bar exam costs and living expenses while preparing for the examination. The University Bar Study Loan is not available to students who are blocked of have a university account that is past due. The application is made available each spring and a limited number of loans are made on a first come first served basis. The application can be found on our Forms page during the application period, usually March to May. Graduating students may also apply for an outside (private) Bar Study Loan. These loans may need to be certified by the Berkeley Law Financial Aid Office. Additionally, graduating 3Ls can request that their Bar Exam "Fees" (e.g. $1,361 for 2012) be added to their cost of attendance for additional loan eligibility. Contact us for details.

 

Private Bar Exam Loans

Currently, there are three private lenders who offer a bar exam loan. Wells Fargo, CitiAssist and Sallie Mae all offer a credit-based, variable interest rate loan. Maximum borrowing limits vary with each lender and range from $12,000 to $15,000, with a minimum loan of $1,000. Please review each lender's website for eligibility requirements, rates and terms.

 

Short Term Emergency Loans

There are two short-term loans available to help students through unexpected financial difficulties. These funds are available within a short period of time and are expected to be repaid accordingly.

  • The UC Berkeley Emergency Loan is an interest-free loan which must be repaid within 60 days. There is a processing fee required to obtain the loan. Click here for updated information on the UC Berkeley Emergency Loan.

  • The Berkeley Law Emergency Loan is available on a limited basis to law students who have exhausted all other sources of emergency, short term funding. Please see the Assistant Dean of Financial Aid for further information.