There are several types of low-interest loans available to students attending graduate school or professional school. Graduate student loans are similar to the undergraduate student loan programs, but often with higher annual loan limit amounts. Some loans are unique to a graduate student’s academic program of study.
The most common types of low-interest loans used by graduate and professional school students include the Direct Unsubsidized Loan, the Grad PLUS Loan and private student loans. The Direct Unsubsidized Loan for graduate students and the Grad PLUS Loan are both unsubsidized loans. Graduate students have not been eligible for Direct Subsidized Loans since July 1, 2012, Graduate students remain eligible for the Perkins Loan, a subsidized loan, dependent on the college’s policies.
Direct Unsubsidized Loan | Grad PLUS Loan | Private Student Loan | |
---|---|---|---|
Annual Limits | Up to $20,500/year | Cost of Attendance - Aid | Cost of Attendance - Aid |
Cumulative Limits | $138,500 or $224,000 |
None |
Varies by Lender
Varies by Degree and Academic Major
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Funds Disbursed to the School | ![]() |
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Cosigner Required? | ![]() |
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Credit Criteria | None | Borrower may not have an Adverse Credit History |
Credit Scores
Debt-to-Income Ratios
No Adverse Credit History
|
Requires School Certification | ![]() |
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FAFSA Required? | ![]() |
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Lender | Federal Government | Federal Government | Private Lenders and Financial Institutions |
Interest Rate Type | Fixed | Fixed | Fixed and Variable Options |
Interest Rate | Fixed at 6.08% for the 2019-2020 academic year | Fixed at 7.08% for the 2019-2020 academic year | Depends on Borrower and Cosigner Credit |
Rate Reduction for Auto Debit | 0.25% | 0.25% | Varies by Lender |
Deductible Interest | ![]() |
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Subsidized Interest | ![]() |
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Loan Fees | 1.059% for loans borrowed Oct. 1, 2019 - Sept. 30, 2020 |
4.236% for loans borrowed Oct. 1, 2019 - Sept. 30, 2020 |
Varies by Lender and Borrower Credit
Typically, 0% to 5% of the amount borrowed
|
Prepayment Penalties | None | None | None |
Interest Capitalization | Once at Repayment | Once at Repayment | Monthly, Quarterly, Annually or Once at Repayment |
In-School and Grace Period Deferment |
Immediate Repayment
Full Deferment
|
Immediate Repayment
Full Deferment
|
Immediate Repayment
Interest-Only Payments
Fixed In-School Payments
Full Deferment
|
Forbearance Options | 3 years | 3 years | 1 year |
Repayment Term |
Varies by Repayment Plan and Loan Balance
10 to 30 years
|
Varies by Repayment Plan and Loan Balance
10 to 30 years
|
Varies by Lender
5 to 25 years
|
Repayment Plans | Standard, Extended, Graduated, ICR, IBR, PAYE, REPAYE | Standard, Extended, Graduated, ICR, IBR, PAYE, REPAYE | Varies by Lender |
Death Discharge | Yes | Yes | Varies by Lender |
Disability Discharge | Yes | Yes | Varies by Lender |
Public Service Loan Forgiveness | ![]() |
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Can be Consolidated? |
Yes
Does Not Relock Rate
|
Yes
Does Not Relock Rate
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Varies by Lender
Rate Based on Current Credit
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Bar Study, Medical Residency and Relocation, and Dental Residency and Relocation Loans | ![]() |
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CONTENTS:
Always start with the Direct Unsubsidized Loan for graduate students. This graduate student loan is available to most graduate and professional students, since eligibility does not depend on the borrower’s credit history. It also does not require a cosigner. The Direct Unsubsidized Loan has a low, fixed interest rate and flexible repayment terms.
If a student has exhausted eligibility for the Direct Unsubsidized Loan, there are a couple of options for additional financing: the Grad PLUS Loan and Private Student Loans for graduate students.
When comparing Grad PLUS and private student loans, there are several possible criteria:
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