Updated
Jun 05, 2023 Graduate student loans are financing options designed to help students pay for graduate school. Since federal student loans offer better borrower protections, you should always consider them before taking out private student loans.
This guide to graduate student loans will help you understand what kind of federal loans you may be eligible for, as well as which private loans to consider in case you max out your federal borrowing limits or don’t qualify for government funding.
In this guide:
- How federal and private graduate student loans compare
- Federal graduate student loans
- Best private graduate student loans
- Which is the best graduate school student loan?
- What can graduate student loans be used for?
- What is the maximum amount I can borrow for graduate school?
- How do I apply for graduate student loans?
- How does repayment of graduate student loans work?
How federal and private graduate student loans compare
While both private and federal student loans work in similar ways to help you pay for your graduate school expenses, there are some important differences between them.
| Federal | Private | |
| Interest rate type | Fixed | Fixed or variable |
| Borrowing limits | Up to the cost of attendance, depending on your loan and field of study | Up to 100% of your school-certified cost of attendance |
| Origination fee | 1.057% for Direct Loans 4.228% for PLUS Loans | None for the lenders below |
| Credit-based | PLUS Loans check for an adverse credit history | Yes |
| Repayment benefits | Income-driven repayment (IDR) plans, federal loan forgiveness, forbearance, deferment | Depends on the lender, but may include forbearance or deferment options |
| Learn more | See federal options | See private options |
Federal graduate student loans
To become eligible for federal loans, you need to fill out the Free Application for Federal Student Aid (FAFSA). The FAFSA is required to gain access to loans from the Department of Education, as well as to obtain many types of grants and scholarships provided by the government or your school.
Federal graduate student loan benefits and drawbacks
There are advantages and disadvantages to funding your graduate school with federal student loans.
Benefits to consider
- Interest rates are fixed
- You have flexibility in repayment options
- You enjoy many borrower protections, such as loan forgiveness
Drawbacks to consider
- You may be limited in the amount you can borrow
- You have to pay origination fees
- You are automatically assigned a loan servicer
Grad students may be eligible for two different types of federal student loans to help cover graduate school costs:
Direct Unsubsidized Loans
While undergrads can obtain both Direct Subsidized and Direct Unsubsidized Loans, grad students are restricted to Unsubsidized Loans. This means the government does not pay interest on the loans while you’re in school or in deferment after graduating.
Direct Unsubsidized Loans still have favorable loan terms for graduate students, however, including a low fixed interest rate.
- Annual borrowing limit: $20,500
- Aggregate borrowing limit: $138,500
- Fixed rate (APR): 6.54%
- Origination fee: 1.057%
- Credit requirement: None
To be eligible, grad students must be enrolled at least half time in an academic program that confers a degree or certification and that participates in the Direct Loan program. You also must complete the FAFSA. Your credit score is not a factor when your eligibility for Direct Unsubsidized Loans is determined.
Grad PLUS Loans
Grad PLUS Loans—which are a part of the Direct PLUS Loan program—are another option for students seeking federal loans. However, they have different rules and eligibility requirements than Direct Loans.
- Annual borrowing limit: Up to 100% of the school-certified cost of attendance
- Aggregate borrowing limit: None
- Fixed rate (APR): 7.54%
- Origination fee: 4.228%
- Credit requirement: Must not have an adverse credit history
To be eligible, graduate or professional students must be enrolled at least half time in a program that will lead to a graduate degree, professional degree or certificate. You also can’t have an adverse credit history, and you must meet the general requirements associated with getting financial aid.
These requirements include:
- Having U.S. citizenship or being an eligible non-citizen
- Having a Social Security number
- Being enrolled at an eligible institution
- Meeting income limits for your family size and year in school
It’s important to note that you cannot qualify for Direct PLUS loans with bad credit, unlike Unsubsidized Loans. And while the interest rate and origination fees are fixed on PLUS loans, the relatively high rate and fees mean that sometimes private student loans are more affordable.
Best private graduate student loans
Unlike federal student loans, private student loans don’t just come from one source, and they don’t have one fixed interest rate.
There are multiple lenders offering private student loans to grad students, including banks, credit unions, and online lenders. There is a lot of variation in interest rates and terms, so you should shop around carefully to make sure you’ve found the best lender for your needs.
Private graduate student loan benefits and drawbacks
There are both pros and cons to consider when using private student loans.
Benefits to consider
- No origination fees
- Flexibility in loan terms among lenders
- Potentially higher borrowing limits
Drawbacks to consider
- Fewer borrower protections, such as forbearance and loan forgiveness
- You’re locked into a repayment schedule unless you refinance your loan
- Credit requirements can affect eligibility
Here are our picks for the best graduate student loans.
College Ave
Editorial Selection: Best Overall
- 6 different graduate student loans
- Cover up to 100% of your school-certified cost of attendance
- Receive a credit decision in just 3 minutes
College Ave is an online student lender offering many different products with low interest rates. The company’s graduate school loans are available in a wide variety of academic disciplines, allowing students to borrow up to 100% of their school-certified educational costs.
Types of graduate student loans College Ave offers
- Master’s and Ph.D. program loans
- Medical school loans
- Dental school loans
- Law school loans
- MBA program loans
- Healthcare profession loans
Terms of College Ave’s graduate student loan
| College Ave’s graduate student loan | |
| Fixed APR | 3.99% to 11.98% |
| Variable APR | 1.99% to 10.97% |
| Loan amount | $1,000 to 100% of school-certified costs |
| Repayment term | 5, 8, 10, or 15 years |
| In-school repayment | Full, interest-only, flat $25, or deferred |
| Grace period | 6 months |
| Fees | Late payment fee |
Sallie Mae
Editorial Selection: Best for Cosigners
- 9 different graduate student loans
- Cosigners can be released after 12 on-time payments
- Lower your rate by 0.25% by enrolling in automatic payments
Sallie Mae is the most well-known private student loan lender in the U.S. In addition to its basic graduate student loan, it also has specific loans for medical school, law school, dental school, and other programs.
Types of graduate student loans Sallie Mae offers
- Master’s and Ph.D. program loans
- MBA program loans
- Medical school loans
- Medical residency loans
- Dental school loans
- Dental residency loans
- Healthcare profession loans
- Law school loans
- Bar study loans
Terms of Sallie Mae’s graduate student loan
| Sallie Mae’s graduate student loan | |
| Fixed APR | 4.25% to 12.92% |
| Variable APR | 2.50% to 12.22% |
| Loan amount | $1,000 to 100% of school-certified costs |
| Repayment term | 15 years |
| In-school repayment | Interest-only, flat $25, or deferred |
| Grace period | 6 months |
| Fees | Late payment fee |
Ascent
Editorial Selection: Best for Eligibility
- 5 different graduate student loans
- Receive a 1% cash reward upon graduation
- Check your rate without impacting your credit
Ascent is an online student lender. The company offers five different graduate student loan options, depending on the field of study. Each of these loans requires a credit check but can be applied for with or without a cosigner.
Types of graduate student loans Ascent offers
- Master’s and Ph.D. program loans
- MBA program loans
- Medical school loans
- Dental school loans
- Law school loans
Terms of Ascent’s graduate student loan
| Ascent’s graduate student loan | |
| Fixed APR | 3.27% to 14.75%1 |
| Variable APR | 0.98% to 11.80%1 |
| Loan amount | $2,001 to $400,000 |
| Repayment term | 7, 10, 12, or 15 years |
| In-school repayment | Interest-only, flat $25, or deferred |
| Grace period | 9 months |
| Fees | Late payment fee |
Earnest
Editorial Selection: Best for Skipping a Payment
- 4 different graduate student loans
- Skip a payment once per year, if needed
- No fees
Earnest is a national student lender offering graduate loans to students in a variety of degree programs. A cosigner is not required, though Earnest makes it simple to add one to your loan. Borrowers can also choose to skip up to one payment per year after they graduate.
Types of graduate student loans Earnest offers
- Master’s and Ph.D. program loans
- MBA program loans
- Medical school loans
- Law school loans
Terms of Earnest’s graduate student loan
| Earnest’s graduate student loan | |
| Fixed APR | 3.24% to 12.78% |
| Variable APR | 1.34% to 11.44% |
| Loan amount | $1,000 to 100% of school-certified costs |
| Repayment term | 5, 7, 10, 12, or 15 years |
| In-school repayment | Interest-only, flat $25, or deferred |
| Grace period | 9 months |
| Fees | None |
SoFi
Editorial Selection: Best for Career Services
- 5 different graduate student loans
- Get access to career services, financial advisors, networking, and more
- Check your rate without impacting your credit
SoFi is an online lender that offers student loans for all levels of education. Its graduate student loan comes with several benefits that include no fees, an online application process, and exclusive member benefits. These member benefits include exclusive rate discounts, access to career services and financial advisors, and more.
Types of graduate student loans SoFi offers
- Master’s and Ph.D. program loans
- Medical school loans
- Law school loans
- MBA program loans
- Healthcare profession loans
Terms of SoFi’s graduate student loan
| SoFi’s graduate student loan | |
| Fixed APR | 4.75% to 13.35% |
| Variable APR | 2.59% to 12.13% |
| Loan amount | $1,000 to 100% of school-certified costs |
| Repayment term | 5, 10, or 15 years |
| In-school repayment | Full, interest-only, flat $25, or deferred |
| Grace period | 6 months (9 months for Healthcare profession loans) |
| Fees | None |
Other lenders that stood out for unique benefits
While the lenders above were the highest rated in our evaluation, the following lenders did stand out for specific benefits:
- Discover: Offers a good grades reward that can result in one percent cash back.
- RISLA: Offers Rhode Island residents and students unique benefits to lower the cost of their loans.
Which is the best graduate school student loan?
First and foremost, you should consider all of the federal student loan options available to you before you turn to private loans. Federal loans can help you pay for graduate school programs with a fixed interest rate, and do not have a minimum credit score requirement.
Federal loans also offer benefits that private loans don’t, such as income-driven repayment plans and loan forgiveness programs. Once you’ve exhausted all of your federal student loan funding, you can then turn to private graduate loans to cover the difference.
Our top-rated pick, College Ave, offers loans with either fixed or variable interest rates to pay for law school, medical school, business school, and more.
What can graduate student loans be used for?
Graduate student loans can be used to cover a variety of education-related expenses, such as tuition, fees, books, housing, and meal plans. You can even use your loan to cover necessary equipment, such as a new laptop for classes.
If you are taking out federal student loans, however, you may reach your annual and/or aggregate loan limits prior to meeting all of your expense needs. In this case, private loans may help cover the difference.
What is the maximum amount I can borrow for graduate school?
Your borrowing limits depend on the type of loans you take out for graduate school. Private loans are available to creditworthy borrowers for up to 100% of their certified expenses.
Federal loans may be subject to annual and aggregate limits; currently, graduate students can borrow up to $20,500 in unsubsidized federal loans each year.
How do I apply for graduate student loans?
Applying for graduate student loans can be a lengthy process, so it’s important to start early.
- Fill out the FAFSA. The Free Application for Federal Student Aid, or FAFSA, is an important form for eligible students to fill out each year. This form will help determine how much financial aid you’re eligible to receive, and is a requirement if you’ll be borrowing federal student loans for graduate school.
- Exhaust federal loan options. Ideally, you’ll want to take out any and all federal loans available to you for the school year. This ensures that you can lock in those important loan benefits and fixed interest rates.
- Consider other funding sources. If you have college savings or plan to work while you’re in school, be sure to factor that money into your budget. This will show you exactly how much more you need to borrow to pay for tuition, housing, and books or equipment for class.
- Apply for private loans. Once you know how much you need beyond federal loans (if anything), you can begin applying for private graduate school loans. Many lenders offer a quick online application process, which will give you an answer in just a few minutes. After you find the loan and terms that work best for you, you can proceed with your loan of choice.
- Add a cosigner. In many cases, adding a cosigner to your loan can be helpful, if not required. A creditworthy cosigner can not only unlock better loan terms and lower rates, but may also enable you to borrow the full amount you need for school.
- Get funded. Once you’ve completed all necessary forms for your new lender, and your school has certified the amount, your loan funds will be sent to the school directly. After the school applies these funds to any outstanding charges, like your tuition bill, the difference can be refunded to you.
How does repayment of graduate student loans work?
All student loan repayment works roughly the same way. First, you borrow money while in school to pay for your necessary educational expenses. After you graduate, your repayment period will begin, and you’ll be responsible for making your monthly loan payments as agreed.
With that said, repaying federal loans can look a bit different than repaying private loans.
Private graduate student loan repayment
When you repay private student loans, your terms will vary by lender. Many private lenders offer at least five-, 10- or 15- year repayment terms. Your payments are always structured to allow you to pay off your loan by the end of the loan term. There are typically no options for income-based repayment or loan forgiveness.
And while you can change your payment plan with federal student loans, you can’t just switch payment plans or change your loan term once you’ve taken out a private graduate school loan. If you want to change the way you pay back your private loan debt, you would have to refinance the loan entirely.
Federal graduate student loan repayment
There are many federal student loan repayment plans available, including the following:
- Standard repayment plan: Loans are repaid over 10 years on a fixed repayment schedule.
- Graduated repayment plan: Loans are repaid over 10 years (or up to 30 years if you consolidate your loans), and payments increase every two years.
- Extended repayment plan: You can either choose from a fixed or graduated repayment schedule, and your loans are repaid over 25 years.
- REPAYE: Payments are capped at 10% of discretionary income. Any outstanding balance on your loans is forgiven after 25 years of payments if you took out loans for grad school.
- PAYE: Monthly payments are capped at 10% of discretionary income, but the payment can’t exceed the amount you’d have paid under the standard repayment schedule. Any outstanding balance on your loans is forgiven after 20 years of payments.
- Income-Based Repayment: Payments are capped at either 10% or 15% of monthly income, and any outstanding balance on your loans is forgiven after 25 years.
- Income Contingent Repayment: Monthly payments equal the lesser of 20% of discretionary income or the amount you’d pay on a fixed payment schedule over 12 years. Any outstanding loan balance is forgiven after 25 years.
- Income-Sensitive Repayment: Monthly payment is based on annual income, but your loan is repaid in 10 years.
Many of these repayment plans have specific requirements you will need to meet, so be sure to talk with your loan servicer to choose the right one.
1 Ascent Student Loans are funded by Bank of Lake Mills, Member FDIC. Loan products may not be available in certain jurisdictions. Certain restrictions, limitations; and terms and conditions may apply. For Ascent Terms and Conditions please visit: www.AscentFunding.com/Ts&Cs. Rates are effective as of 10/01/2022 and reflect an automatic payment discount of either 0.25% (for credit-based loans) OR 1.00% (for undergraduate outcomes-based loans). Automatic Payment Discount is available if the borrower is enrolled in automatic payments from their personal checking account and the amount is successfully withdrawn from the authorized bank account each month. For Ascent rates and repayment examples please visit: AscentFunding.com/Rates. 1% Cash Back Graduation Reward subject to terms and conditions. Cosigned Credit-Based Loan student must meet certain minimum credit criteria. The minimum score required is subject to change and may depend on the credit score of your cosigner. Lowest APRs require interest-only payments, the shortest loan term, and a cosigner, and are only available to our most creditworthy applicants and cosigners with the highest average credit scores.