The U.S. News and Official Guide data released information about 44,245 ABA law school graduates who acquired $3.6 billion in student loans in 2010. This number is up from the $3.1 billion of debt for the students back in 2008.
The reason for the increase in law school student debt is the fact that the government permits students to completely finance their legal educations and their living expenses. This occurs because the government provides law students with grants of $20,500 from Federal Direct Stafford Loans and Graduate PLUS loans, which cover the remainder of the costs of law school for students. As a result, the amount of debt law students will accrue is bound to increase greatly in the future because of tuition increases. This causes Congress to have no solutions for the 199 J.D.-conferring law schools that employ 22,000 people at their current rate of salary.
It can be doubted that the law schools in the United States did not send the ABA the correct debt information for their 45,000-plus graduates based on recent news about law schools fabricating statistics in an effort to keep people applying. In a more believable scenario, the law schools probably took an average of their students’ debt and submitted those numbers to the ABA.
In order to correctly calculate the total amount of law school graduate debt, three things are needed. Those three things include the number of graduates across the country, the breakdown of the graduates between public and private, and the amount of those graduates who actually took on debt. From 2008 to 2010, the average split between public and private law schools graduates was at 35/65 based on the Official Guide. According to U.S. News, in the same time frame, 85 percent of all public school graduates took on debt, which can be compared to the 84 percent of private school graduates.
Two of the 16 law schools that received accreditation from the ABA from 2001 to 2009 were public schools. Accreditation was granted to Irvine in 2011, so this school is not counted in the tally. The legal education industry has been one of the most successful in the country over the past two decades, boasting a 6.9 percent annual growth rate when it comes to debt-revenue.
For 2010 graduates of law schools, the total debt average was at $97,310 for those graduates who borrowed money. Based on current enrollment numbers, the 44,706 of 53,000 students who should graduate in 2020 will acquire debt to get through school. The total average debt for those graduates will be $156,977. That number will be $118,128 for public law school graduates and $178,179 for private school graduates.
As the projected doubling of law school debt by 2020 is very troubling, law schools are claiming that law students must spend billions of federal dollars if they wish to obtain legal educations. Congress needs to destroy the Direct Loan Program and determine an equal and pain-free method to record the debts of law students. This should include adding bankruptcy protection to student loans, both private and public.
Statistics and other information researched from The AmLaw Daily.