Loans
Forms
University Bar Study Loan Application 2009
Budget Appeal for the 2008-2009 Academic Year
Substantial changes have been made to the federal and private educational loans that will be available to you starting with the 2007-08 academic year. In addition to federal subsidized and unsubsidized loans having their interest rate fixed at 6.8 percent, the federal government’s Direct Loan Program will provide the Graduate PLUS Loan with a fixed 7.9 percent interest rate.
Loans are the principal source of aid available to law students to fund their education. Educational loan resources include William D. Ford Federal Direct subsidized, unsubsidized, and Graduate PLUS Loans, Perkins Loans, private educational loans and short-term emergency loans available from the university and Berkeley Law.
Loans with the most favorable terms are always made available first to offset student financial need. The majority of educational loans is provided by the federal government. Only U.S. citizens and permanent residents are eligible to receive federal student loans.
William D. Ford Federal Direct Loans (subsidized)
A maximum of $8,500 per year is available to students who qualify on the basis of financial need. Due to federal legislation, subsidized loans disbursed after July 1, 2006 will have a fixed interest rate of 6.8 %. Unless the borrower has consolidated them, the interest rate for loans disbursed before that date is variable. The variable interest rate is changed every July 1, based upon the 91 day Treasury bill plus 2.3 percentage points when in repayment, and capped at 8.25 %. The interest rate for July 1, 2007 - June 30, 2008 will be 7.22 percent.
Interest and principal on the subsidized Direct Loan are deferred until 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. The UC Berkeley Financial Aid Office will provide detailed information about the Direct Loan application process in your financial aid offer letter.
William D. Ford Federal Direct Loans (unsubsidized)
A maximum of $20,500 per year is available. The combined total of subsidized and unsubsidized Federal Direct Ford Loans cannot exceed $20,500. Like subsidized loans, unsubsidized loans disbursed after July 1, 2006 will have a fixed interest rate of 6.8 %. For unsubsidized loans disbursed before that date, the information is the same as for subsidized loans.
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 repayment penalty. The UC Berkeley Financial Aid Office will provide detailed information about the Direct Loan application process in your financial aid offer.
Perkins Loans
Federal Perkins Loan are awarded primarily to non-resident first-year students. Like the Direct Loan, a promissory note will be provided to you for completion before a payment can be made. 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 %.
Graduate PLUS & Private Loans
Students who need to borrow funds beyond the federal subsidized, unsubsidized, and Perkins loan limits will be able to choose between the new federal Graduate PLUS Loan ("Grad PLUS") and a private educational loan. Review the Federal Graduate PLUS Loan vs. Private Loan Comparison Chart here. The Grad PLUS will have a fixed 7.9 % interest rate and all of the federal student loan benefits during the life of the loan while the private educational loan may be less expensive depending on your credit score and whether the variable interest rate will increase until you complete repaying the loan.
The University of California provides the following Preferred Private Lender List: http://www.ucop.edu/sas/sfs/loans/privlaw.pdf
Note: Chase Bank is offering additional incentives to Berkeley Law students. The interest rate margins are priced lower than what is posted on the Preferred Private Lender List. The interest rate with a co-signer will be as low as the 3-month LIBOR + 3.20% up to the 3-month LIBOR + 7.50%. This results in an interest rate reduction of up to 2.75%. Non-cosigned loans are priced at 2.70% lower for Berkeley Law students.
The Grad PLUS is provided by the William D. Ford Direct Loan Program because UC Berkeley is a Direct Loan institution for federal student loans.
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.
All Federal Graduate PLUS loans have a 2.5 % origination fee deducted from the loan amount. If you decide to borrow a Graduate PLUS loan, you may wish to increase the amount you need to borrow to make up for the fees. We will increase your budget to compensate for the fees. Use the example below to calculate the net amount of the loan you wish to borrow.
Example: If you want to borrow a net amount of $15,000, you should apply for $15,000/.975 = $15,385.
To apply for the Grad PLUS (after having completed your FAFSA), send an email to financial-aid@law.berkeley.edu with your name, Student ID Number and indicate the amount you would like to borrow through the Grad PLUS. We will certify your eligibility for the amount requested.
A separate Master Promissory Note (MPN) must be completed for the Grad PLUS at http://dlenote.ed.gov. Terms and conditions of the Grad PLUS loan will be explained in the MPN.
To apply for a private educational loan, submit an application online with the lender of your choice. 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 campus and applied to a student's CARS account beginning in early August for the fall term and early January for the spring term.
Short Term 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 for up to $725 per semester. It must be repaid within 60 days. There is a $20 processing fee required to obtain the loan. A completed application, current registration status and social security number are required to take out the loan. It takes approximately one hour to process each loan. All loans must be received the same day that they are processed. The Emergency Loan Office is located at 220 Sproul Hall and is open Monday through Thursday from 9 a.m. to 1 p.m. This loan is also available for a lesser amount during the summer to continuing students enrolled in summer sessions at UC Berkeley. 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 Dean of Students for further information.
