Bar study loans are private, credit-based student loans designed to assist students and recent graduates with the costs of preparing for and taking the bar exam. Bar study loans may be a useful option if you do not have the finances necessary to cover your bar exam costs and your living expenses while you study for the bar. Unlike educational loans borrowed during the academic year, the amount offered will be determined by the lender. Generally, students may be eligible to borrow up to $15,000; however, the maximum is set by the lender based on credit worthiness and total indebtedness.
Keep in mind:
- A bar study loan, you will have a separate repayment obligation with the lender.
- A bar study loan cannot be included in a federal loan consolidation; it also is ineligible for any of the federal loan repayment options currently available, such as the income driven repayment plans. A bar study loan cannot be included in the Federal Public Service Loan Forgiveness Program.
- Bar study loans do require school certification; however, unlike other education loans, bar study loan funds are mailed directly to the borrower’s address as indicated on the loan application, rather than being delivered to the student’s Bursar account. School certification may take up to two weeks to process, and new federal regulations require a ten-day waiting period before private loan proceeds are disbursed to the borrower.
Before borrowing a bar study loan, we strongly encourage you to:
- Review your estimated expenses.
- If you are currently enrolled, investigate if you have any remaining annual federal loan eligibility. If you have not exhausted your maximum federal loan eligibility, you would be better advised to do so before borrowing a private bar study loan. Federal education loans may be a less expensive option than a private loan and carry several benefits that private loans do not. (e.g., lower fees, deferment, cancellation, and generous repayment terms) APPLICATION PROCESS AND LENDER OPTIONS
If you wish to apply for a bar study loan, carefully evaluate your lender options and apply directly with the lender you choose (see below). Student Financial Services does not have a preferred lender’s list, nor do we recommend any specific lender. We do have a lender search that contains lenders that our students have used successfully in the past, but it is not an exhaustive list of lenders. Bar study loan lenders listed in the search are to assist you in researching a lender. To have a successful search in the online lender search, select the program, “Bar’ under “Select Your Program”.
FAQ (Frequently Asked Questions)
What is a bar study loan?
A bar study loan provides funding to cover the fees associated with the preparation and taking of the bar, as well as support for your living costs during your post graduate bar study period.
Who offers bar study loans?
Bar study loans are presently only offered by private lenders. No Federal Direct Loans are available unless you are enrolled at least half time. Contact information for those active bar study loan lenders are included below.
How much money can I borrow?
Each lender sets different loan limits which can range from $12,000 - $15,000.
What is the approval process?
As a private loan, the bar study loan approval is credit-based and at the discretion of each lender’s criteria. Before applying for a bar study loan, you may wish to check your credit at www.annualcreditreport.com which provides free access to your report from the three credit bureaus: Equifax, TransUnion and Experian. By reviewing your credit in advance of the bar study loan application, it may provide you with time to rectify any discrepancies on the credit report or correct any credit issues incurred.
What is the interest rate?
Because these are private loans, lenders set their own interest rates. Fixed rates, where the rate remains the same over the life of the loan, or variable rates, where the rate changes over time, are available.
What other factors should I review in evaluating bar study loan options?
- Fees – are there origination or disbursement fees associated with the loan? If so, be conscious of the percentage that will be deducted from your loan disbursement.
- Interest Rate Reductions – does the lender offer any interest rate reductions for either automatic debit or prior account or loan history with the lender?
- Repayment terms – how long will you have to pay the loan back? Is there any type of post enrollment grace period offered? Are there other deferment or forbearance options?
When should I apply for a bar study loan?
Traditionally, you should apply for the bar study loan anytime during your final spring semester. Because payment of the loan comes directly to you – you will be able to set the beginning and end date of the loan, as well as the disbursement dates.
How do I begin the bar study loan application process?
The best way to begin the process is to compare the various bar study loan products from the different lenders. Visit the website of the lenders or contact a lender representative directly. In essence, you are “shopping” at this point to determine which loan product will best fit your financial situation. Do not submit applications to multiple lenders since each submission may impact your credit score. Again, some key points to compare are:
- determination of approval (i.e. credit standard),
- maximum loan amount, loan period and disbursement dates,
- interest rates - fixed vs. variable, fees,
- available interest rate reductions, and
- repayment terms (including grace period, deferment, and forbearance availability)
Will I need a co-signer?
If you have poor credit or if you have not established enough of a credit history, you will be asked to add a co-signer to your application to gain approval. Consider adding a credit worthy co-signer to lower your interest rate. In addition, international students may be required to apply with a U.S. citizen co-signer to receive approval.
Do I have any alternatives to the bar study loan?
If you have remaining federal loan eligibility for the Spring term you may wish to borrow additional federal loans for the Spring and set aside your refund to fund your post graduate bar study. Federal loans may offer lower interest rates and more flexible repayment plans options than private loans.
