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Compare Graduate Student Loans

Graduate students can take out federal direct unsubsidized loans, federal Grad PLUS loans or private student loans.
April 20, 2018
Loans, Student Loans
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There are three main types of graduate student loans, each with pros and cons:

  • Federal direct unsubsidized loans have lower interest rates and fees than PLUS loans, but there are limits to the amount you can borrow.
  • Federal Grad PLUS loans have higher interest rates and fees than direct unsubsidized loans, but you can borrow more money in PLUS loans.
  • Private student loans don’t qualify for income-driven repayment plans and loan forgiveness programs like federal loans do, but the interest rates may be lower than federal loan rates if you have excellent credit.

The type of graduate student loan that’s best for you depends on your credit score, access to a co-signer and whether or not you want to take advantage of income-driven repayment plans and loan forgiveness programs. Generally, max out federal student loans before taking out private ones. However, you may qualify for a lower interest rate with a private graduate student loan if you have excellent credit. Before borrowing, get personalized private student loan rate estimates and compare them with federal loan rates.

» MORE: 7 ways to get the lowest interest rate on student loans

You can often postpone payments on undergraduate and graduate student loans while you’re enrolled in school at least half-time through a process called deferment. However, if you can afford to make full or interest-only payments during graduate school, you should. Except for on subsidized federal loans, interest will accrue on loans during deferment and increase the total amount you’ll pay over time.

If the loans are federal, your loan servicer may put them into deferment automatically, or you can call the servicer and/or your school’s financial aid office to request a deferment. For private student loans, contact your lender or servicer to ask about in-school deferment — many, but not all, private student lenders offer it.

1. Federal direct unsubsidized loans

Use this type of loan if you have bad credit or no credit, and/or if you want the option to make loan payments that are based on your income or apply for programs like Public Service Loan Forgiveness. To apply for federal direct unsubsidized loans, fill out the Free Application for Federal Student Aid, known as the FAFSA.

  • Interest rate: 6.00% (Effective July 1, 2017, to June 30, 2018)
  • Loan fee: 1.07% (Effective Oct. 1, 2017, to Sept. 30, 2018)
  • Loan type: Fixed
  • Grace period: Six months

Graduate students can borrow up to $20,500 a year and up to $138,500 total in federal direct unsubsidized loans, which are sometimes called unsubsidized Stafford loans. The total loan limit includes any federal loans you took out for undergraduate education. There’s no credit check required for direct unsubsidized loans, which means you can qualify regardless of your financial history.

The loan fee will be taken as a percentage of the total loan amount and deducted proportionally from each loan disbursement, meaning you’ll receive slightly less than the amount you borrow.

2. Federal Grad PLUS loans

Use Grad PLUS loans if you’ve maxed out your federal direct unsubsidized loans and you still want to use federal loans to pay for graduate school. Submit the FAFSA to apply.

  • Interest rate: 7.00% (Effective July 1, 2017, to June 30, 2018)
  • Loan fee: 4.26% (Effective Oct. 1, 2017, to Sept. 30, 2018)
  • Loan type: Fixed
  • Grace period: None. If you’re in school less than half-time, the loan will enter repayment immediately after it’s disbursed. You can apply to defer payments while you’re in school at least half-time; if you do, repayment will begin six months after you leave school or drop below half-time enrollment.

The maximum borrowing limit for federal PLUS loans is your cost of attendance minus any other financial aid you receive. Unlike with direct unsubsidized loans, the government will check your credit before approving you for a PLUS loan. You don’t need a particular score to qualify; you just need a financial history that’s clear of red flags such as a bankruptcy or foreclosure in the last five years, or a history of making late payments to creditors.

The loan fee will be taken as a percentage of the total loan amount and deducted proportionally from each loan disbursement, meaning you’ll receive slightly less than the amount you borrow.

3. Private graduate student loans

Private graduate student loans may be the best option if you have excellent credit or a co-signer who does, and you don’t need access to income-driven repayment or forgiveness programs. Compare your options below or on NerdWallet’s private student loan page to find the lowest rate you qualify for.

  • Interest rate: Varies based on credit
  • Loan fee: Typically none, but it depends on the lender
  • Loan type: Fixed or variable
  • Grace period: Generally six months, but it varies by lender

With private graduate student loans, your interest rate will be partly based on your credit. Lenders generally look for a credit score at least in the high 600s, but the higher your score, the lower the rate you’ll likely get. You may qualify for a lower rate by applying with a co-signer.

Compare private graduate student loans

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