Highlights:
- A Republican-backed proposal to cap student loans for graduate degrees could significantly impact law students, especially those attending lower-ranked or unranked schools.
- Students who exceed the cap would need to rely on private loans, which may come with higher interest rates and stricter qualification requirements.
- The proposal could reduce access to legal education for lower-income and minority students, potentially making the profession less diverse.
- Supporters argue the cap will reduce tuition inflation and prevent students from overborrowing.
A proposed cap on federal student loans for graduate and professional degrees is drawing both support and concern, as critics warn it could restrict access to law school for thousands of aspiring attorneys—particularly those from minority and low-income backgrounds.
What the Proposal Entails
Currently under Senate consideration, the proposal passed by the U.S. House of Representatives in May would introduce annual federal loan caps ranging from $50,000 to $77,000 and lifetime limits between $150,000 and $200,000.
This would replace the current system, which allows graduate students to borrow the full cost of tuition and living expenses through federal loans.
The policy, if enacted, would apply to all professional degrees but would hit law and medical students the hardest due to their higher educational costs.
Critics Raise Equity and Affordability Concerns
Legal education experts and deans of law schools warn that the policy may disproportionately affect students attending lower-ranked and unranked law schools—institutions that tend to enroll more minority and first-generation students. Without access to additional federal loans, students would need to turn to private lenders, who may impose stringent credit and income checks.
According to AccessLex Institute data, law students borrowed an average of $146,800 in 2020, and many programs exceed the proposed caps.
Ronald Weich, dean of Seton Hall Law School, cautioned that limiting federal loans could “make the profession less inclusive” by restricting access for students who lack the means or credit support to qualify for private financing.
Check Out: The Financial Aid For GED
Supporters Aim to Curb Tuition Inflation and Overborrowing
Proponents, including Senator Bill Cassidy, argue that uncapped federal loans have fueled tuition hikes and encouraged students to pursue expensive degrees with poor job prospects. “By capping inflationary graduate loan programs, we prevent students from overborrowing and put downward pressure on rising college costs,” Cassidy told Reuters.
Still, the proposed caps raise alarm for many schools already grappling with the economic realities of student debt, especially where employment outcomes are modest. A Notre Dame study found that at several unranked schools, median law school debt exceeded twice the graduates’ annual salaries.
Also in the News: