The Best Medical School Loans: Federal and Private Options in 2025

Paying for medical school without loans would be impossible for a large percentage of students. Scholarships and grants can help, but you’ll likely need to turn to federal or private loans to cover the cost of attendance. But how do you choose between federal and private medical school loans? Interest rates and fees can be high for Direct Unsubsidized and Grad PLUS federal loans. 

If you have a strong credit score or a willing cosigner, you may lock in a much lower rate with a private loan. Proceed with caution, though: Private loans aren’t eligible for the same federal loan benefits, including loan forgiveness and income-based repayment. If you’re counting on those programs, it might be better to use federal loans, even if they’re more expensive on paper.

Lender	Best for	Our rating
Dept. of Education	Federal student loans	Not rated
College Ave	Best Overall	5/5
Sallie Mae	Cosigners	4.8/5
Earnest	Large Loans	4.7/5
SoFi	Member Benefits	4.7/5
ELFI	Personalized Support	4.5/5

Types of medical school loans

Much like student loans for undergraduates, the two main types of medical school loans are federal and private. 

Federal loans for medical school

Financial aid includes several types of federal student loans for med school students:

• Direct Unsubsidized loans, also called Stafford loans
• Direct PLUS loans, also called Grad PLUS loans
• Loans through the Health Resources and Services Administration (HRSA) for specific schools of medicine

Direct Unsubsidized loans (Stafford loans)

This is the primary federal loan available to grad students, including medical students. The standard max borrowing limit for 2025 is $20,500, but students in health professions programs can get an additional:

• $20,000 for a nine-month academic year
• $26,667 for a 12-month academic year

Direct Unsubsidized loans have higher interest rates for graduate and professional students than undergrads. Here’s what to budget for through the end of June 2025:

• Interest rate: 8.08%
• Loan fees: 1.057%

After school, there’s a six-month grace period, and then the standard repayment period is 10 years, though you can easily set up a different term if needed.

Direct PLUS loans

If the $40,500 to $46,667 a year won’t be enough to cover med school (and it probably won’t), you can turn to Direct PLUS loans. You may recognize these from undergrad, when they were called Parent PLUS loans (because parents took them out). In grad school or medical school, students can take them out—and they’re called Grad PLUS loans.

Here’s a quick look at the details through the end of June 2025:

• Max limits: Up to your cost of attendance (including living expenses), minus other estimated financial assistance
• Interest rate: 9.08%
• Loan fees: 4.228%

While the maximum limit is helpful, the interest rate and loan fees are reasons to consider private loans—more on that later.

Note: Unlike the Unsubsidized Loans, interest starts accruing on PLUS loans as soon as they’re disbursed.

HRSA loans

Students studying a specific type of medicine may be able to qualify for loans through the Health Resources and Services Administration. Speak with your school’s financial aid office to learn more about:

• Loans for disadvantaged students
• Health professions student loans
• Nursing student loans
• Primary care loans

Private student loans for medical school

Much like during undergrad, you can turn to private student loans to help fund your education in med school. But with federal Grad PLUS loans covering the cost of attendance (minus other aid), why would you want to choose a private loan?

Interest rates are a major reason. If you have strong credit (or a cosigner with strong credit) and a stable income, it should be easy to beat the interest rate for Grad PLUS loans—often without application and origination fees, too.

Private loans can offer fixed or variable rates; proceed with caution if a loan has a variable interest rate that could increase.

The best medical school loan companies offer:

• Deferment during residency and fellowship
• Long grace periods
• Flexible repayment options, including in-school, partial, and deferred payments
• Cosigner release

However, your private loans won’t be eligible for federal loan benefits, including public service loan forgiveness (PSLF) and income-based repayments. 

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Should you take out federal loans for medical school vs. private?

Wondering whether you should take out federal or private loans for med school? The frustrating answer: It depends, and probably both. Here’s why:

• Direct Unsubsidized Loans max out at either $40,500 or $46,667 a year, depending on how many months you’re in school. At an 8.08% interest rate and 1.057% loan fee, this most basic loan for med students is insufficient for the total cost of attendance—and it’s rather expensive.
• You can supplement with Direct PLUS loans, but these are even more expensive, at a 9.08% interest rate and a steep fee of 4.228%. Theoretically, you can use this aid to cover the rest of your education.
• Depending on the type of medicine you’re studying, you may be eligible for additional aid through HRSA loans, but that’s not guaranteed.

So why consider private loans if you can get scholarships and grants, loans through the HRSA, Stafford loans, and Grad PLUS loans to fully cover the cost of school? If you have a good credit score (or a willing cosigner), you can likely qualify for a much lower interest rate with a private lender. That could save you a significant amount in the long run.

But not so fast: Even if you qualify for low-interest private loans, federal loans may pay off in the long run. For instance, federal loans are eligible for PSLF, for which many residency programs qualify. If, after residency, you work for a nonprofit health institution or a government office, you have a real shot at the 10-year requirement to have your debt forgiven.

Plus, some private loans may require payments while you’re in school or may come with variable interest rates, which could make them even less attractive, depending on your needs.

When deciding between federal versus private student loans, consider our anticipated career path, expected income, and financial goals. If you are uncertain about working in a setting eligible for loan forgiveness programs, I generally recommend starting with federal loans to maintain flexibility. If your financial situation warrants it in the future, you can consider refinancing or consolidating into private student loans when it becomes a more beneficial option.

Back to the original question: Should you take out federal student loans or private loans for med school? The TL;DR answer:

If…	Use…
The federal interest rate is lower than private loans	Federal loans
You have strong credit and qualify for a low-interest private loan	Private loans
You think you’ll qualify for PSLF or may need income-based repayment options	Federal loans
You have a willing cosigner who can help bring private loan rates down	Private loans
The private loan repayment terms aren’t flexible enough for your needs	Federal loans
You don’t qualify for federal loans	Private loans

Best private medical school loans

We researched and reviewed the best graduate school loans to help you find the best fit for medical school. Here are our picks.

College Ave

Sallie Mae

Earnest

SoFi 

ELFI

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The Best Graduate Student Loans: How to Choose Federal and Private Options

Who is eligible for private medical school student loans?

Private student loan eligibility requirements for medical students are standard as far as private loans go. They’ll vary by lender, but in general, expect the following requirements:

• Locations: Many lenders may operate in specific states. Earnest, for example, doesn’t lend in Nevada.
• Age and citizenship: Med school lenders typically require U.S. citizenship or permanent resident status. You’ll also need to be the legal age of majority in your state.
• Program: Lenders usually require enrollment in specific medical programs. College Ave, for instance, awards loans to students pursuing their MD, DO, DVM, VMD, or PM degree. Some lenders may require at least half-time enrollment; others, including Sallie Mae, will let you borrow even if you’re in school less than half-time.
• Minimum borrowing amount: While private lenders typically lend up to your cost of attendance, they may also have a minimum borrowing requirement. SoFi’s med school loans start at $1,000.
• Creditworthiness: This is the biggie. Qualifying for a private medical school loan requires good credit. For instance, Earnest requires a minimum credit score of 650. If you don’t meet credit score requirements, you may need to add a cosigner with good credit. Many lenders have cosigner release options for down the road.

And, of course, before applying for a private medical school loan, you’ll first need to fill out the FAFSA, factor in family contributions (including 529 savings), and apply for grants and scholarships.

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Alternatives to medical school student loans

If private student loans don’t make sense for your situation, there are other ways to fund medical school. Here are options to consider:

Scholarships and grants

Federal financial aid may include some grants and scholarships, but that might not be enough to cover your costs. If you need additional funding, look for scholarships from medical associations, nonprofit organizations, hospitals, and private foundations. 

Many medical schools also offer their own scholarships based on merit or need, so check with your school’s financial aid office.

Choose a more affordable medical school

Medical school costs vary, and some programs are much cheaper than others. If you’re flexible, consider attending a public medical school in your home state, which often has lower tuition for residents. 

Some schools even offer tuition-free programs or reduced costs if you commit to working in an underserved area after graduation. NYU Grossman School of Medicine, for example, offers full-tuition scholarships to all its students, regardless of financial need or merit.

Service-based programs

Some programs will cover part or all of your medical school costs in exchange for a commitment to work in a specific area after graduation. The National Health Service Corps (NHSC) scholarship, the military’s Health Professions Scholarship Program (HPSP), and certain state loan forgiveness programs are all worth looking into.

How to get loans for medical school

If you need loans to cover medical school costs, here’s a simple step-by-step guide to securing funding:

1. Fill out the FAFSA

Start by completing the Free Application for Federal Student Aid (FAFSA) to access federal student loans. Even if you don’t think you’ll qualify for need-based aid, this is the key to getting federal loans, which often have better repayment terms than private options.

2. Review your financial aid package

Your school’s financial aid office will determine how much federal aid you qualify for. Since federal loans typically offer lower interest rates and better repayment flexibility, it’s best to use these first.

3. Explore scholarships, grants, and service-based aid

Before taking out private loans, look for scholarships, grants, and service-based programs that can reduce your borrowing. Many medical schools, nonprofit organizations, and government programs offer funding in exchange for commitments like working in underserved areas after graduation.

4. Consider private loans if needed

If federal loans and other aid don’t fully cover your costs, private student loans can help fill the gap. Compare lenders based on interest rates, repayment flexibility, and borrower protections. If you have a creditworthy cosigner, you may qualify for better terms.

5. Borrow only what you need

Medical school is expensive, but overborrowing can make repayment more challenging later. Stick to borrowing only what’s essential for tuition and necessary living expenses.

6. Plan for repayment early

Even though you won’t have to start repaying loans until after school (or after residency, in some cases), it’s helpful to have a strategy. Look into income-driven repayment plans, loan forgiveness programs, and refinancing to keep future payments manageable.

The most common situation I encounter new doctors face when juggling student loans isn’t necessarily a pitfall, but rather a short-term income-to-repayment gap. Early in their career, a student’s income may be lower than anticipated, making it challenging to meet loan repayment obligations. This scenario provides a strong reason to begin with federal student loans, as they offer more flexible repayment options to manage such challenges.

FAQ

Which loan is best for medical school?

Federal loans are worth considering first because they offer safeguards, including income-driven repayment and forgiveness programs. Most med students use Unsubsidized or PLUS Loans, which can cover the cost of attendance despite higher rates. If these don’t meet your needs, explore private student loans—but always compare lenders to ensure you get the best deal.

Do medical school loans cover living expenses?

Yes, student loans for medical school can cover tuition, fees, and living expenses, including rent, food, and transportation. Your school sets a cost of attendance (COA), which determines the maximum amount you can borrow, including money for living costs. Borrow wisely to avoid excessive debt.

How long will it take me to repay my medical school loans?

It depends on your loan balance, repayment plan, and career path. Standard repayment takes about 10 years, while income-driven plans can extend up to 20 or 25 years but may include forgiveness. Working in public service could qualify you for PSLF after 10 years of payments. 

If you have strong credit, refinancing with a private lender might let you pay off loans faster (five to 20 years), but you’ll lose federal protections.

How do medical school loans affect my future borrowing ability as a doctor?

Your student loans influence your debt-to-income ratio (DTI), which lenders use when evaluating mortgage and business loan applications. However, many lenders understand that doctors have high earning potential and offer physician mortgage loans or other specialized financing options with more flexible DTI requirements. If your monthly payments are manageable, your medical school debt shouldn’t stop you from borrowing for a home or practice in the future.

How we chose the best loans for medical school

LendEDU evaluates student loan lenders to help readers find the best student loans. Our latest analysis reviewed 725 data points from 25 lenders and financial institutions, with 29 data points collected from each. This information is gathered from company websites, online applications, public disclosures, customer reviews, and direct communication with company representatives.

These star ratings help us determine which companies are best for different situations. We don’t believe two companies can be the best for the same purpose, so we only show each best-for designation once.

Recap of the best medical school student loans