If you’re looking to advance your career or increase your earning potential, going back to school for a master’s degree or professional certification can be an important step. However, the cost of returning to school can be expensive. According to education resource Peterson’s, annual tuition at a public university is nearly $30,000. A private university could cost you close to $40,000 per year.
If you don’t have that much money in the bank, and few people do, you’ll likely have to turn to student loans to cover the bill.
How to get student loans for grad school
Depending on the cost of your program, you could rely on federal student loans, private loans, or a combination of both. Here’s how to get student loans to fund your master’s or professional degree program.
Federal student loan options
When you’re deciding how to finance your education, look to federal student loans first. Federal loans tend to have lower interest rates, more generous repayment terms, and more perks than private student loans. These perks can make student loan repayment easier on your budget.
For example, federal loans are eligible for repayment plans that are based on your income, which can reduce your monthly payment. Also, you might be able to get some or all of your student loans forgiven if you work in certain fields.
To apply for federal loans, you must first complete the Free Application for Federal Student Aid (FAFSA). As a returning student, you might qualify for the following federal loans.
Direct Unsubsidized Loans
As a graduate or professional student, you can take out a Direct Unsubsidized Loan with an interest rate of 6.00%. There’s a limit on how much you can borrow; graduate students can take out $20,500.
To qualify for the loan, you must enroll in school at least half time. There’s also a fee of 1.066% deducted from each loan disbursement, adding to the cost of your loan.
Direct PLUS Loans
If you’re a graduate or professional student enrolled in school at least half time, you could qualify for a Direct PLUS Loan. Direct PLUS Loans have an interest rate of 7.00%. In addition, there’s a loan fee of 4.264% deducted from each loan disbursement, which adds to your education costs.
Although Direct Unsubsidized Loans limit how much you can borrow, PLUS Loans work differently. The maximum amount you can borrow in PLUS Loans is your cost of attendance minus any other financial aid you received.
Unlike other federal student loan options, the government will check your credit when it reviews your PLUS Loan application. If you have an adverse credit history, you might not be able to receive a loan on your own. Instead, you’ll need to apply with an endorser or pursue other funding options.
Private student loans
In some cases, federal loans alone won’t be enough to cover the cost of your education. Private student loans can help fill the gap and allow you to complete your education.
Unlike federal student loans, which are issued by the government, private student loans are issued by private banks and financial institutions. The lender will look at your credit history and income to decide whether to give you a loan. Each bank has its own eligibility criteria, so you have to apply with each lender to see if you qualify. If you don’t qualify on your own, you might be able to take out a loan by applying with a cosigner.
When it comes to graduate school, private student loans offer some unique benefits. Depending on your program and area of study, you could qualify for student loans that cover cost-of-living expenses or even relocation. With Discover Student Loans, for example, you can take out a loan to cover the cost of medical residency and relocation or cost-of-living expenses while you prepare for the bar exam.
Some lenders also allow graduate students to defer payments while they establish their careers. For example, Citizens Bank offers medical and dental students a four-year residency deferment.
Keep in mind that private student loans usually have higher interest rates than federal ones. However, many lenders offer both fixed and variable rates. If you’re determined to pay off your debt as quickly as possible, you could opt for a variable-rate loan to take advantage of lower interest rates.
Private loans are ineligible for federal repayment programs, such as income-driven repayment plans and loan forgiveness. However, they can be a useful tool to finance your education if you run out of federal funding.
Financing your education
Going back to school can help you earn more money over the course of your career. If you’re trying to figure out how to get student loans to finance your education, it’s a good idea to consider both your federal and private options.
To save money and reduce the amount you need to borrow, check out some scholarships and grants for adults returning to college.
Need a student loan?Here are our top student loan lenders of 2019!
|2 Important Disclosures for College Ave.
College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
(1)All rates shown include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. Variable rates may increase after consummation.
(2)This informational repayment example uses typical loan terms for a freshman borrower who selects the Deferred Repayment Option with an 8-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 7% variable Annual Percentage Rate (“APR”): 96 monthly payments of $179.28 while in the repayment period, for a total amount of payments of $17,211.20. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
(3)As certified by your school and less any other financial aid you might receive. Minimum $1,000.
Information advertised valid as of 5/22/2019. Variable interest rates may increase after consummation.
* The Sallie Mae partner referenced is not the creditor for these loans and is compensated by Sallie Mae for the referral of Smart Option Student Loan customers.
3 = Sallie Mae Disclaimer: Click here for important information. Terms, conditions and limitations apply.
4 Important Disclosures for Discover.
5 Important Disclosures for SunTrust.
Before applying for a private student loan, SunTrust recommends comparing all financial aid alternatives including grants, scholarships, and both federal and private student loans. To view and compare the available features of SunTrust private student loans, visit https://www.suntrust.com/loans/student-loans/private.
Certain restrictions and limitations may apply. SunTrust Bank reserves the right to change or discontinue this loan program without notice. Availability of all loan programs is subject to approval under the SunTrust credit policy and other criteria and may not be available in certain jurisdictions.
©2019 SunTrust Banks, Inc. SUNTRUST, the SunTrust logo and Custom Choice Loan are trademarks of SunTrust Banks, Inc. All rights reserved.
6 Important Disclosures for LendKey.
7 Important Disclosures for CommonBond.
A government loan is made according to rules set by the U.S. Department of Education. Government loans have fixed interest rates, meaning that the interest rate on a government loan will never go up or down.
Government loans also permit borrowers in financial trouble to use certain options, such as income-based repayment, which may help some borrowers. Depending on the type of loan that you have, the government may discharge your loan if you die or become permanently disabled.
Depending on what type of government loan that you have, you may be eligible for loan forgiveness in exchange for performing certain types of public service. If you are an active-duty service member and you obtained your government loan before you were called to active duty, you are entitled to interest rate and repayment benefits for your loan.
A private student loan is not a government loan and is not regulated by the Department of Education. A private student loan is instead regulated like other consumer loans under both state and federal law and by the terms of the promissory note with your lender.
If your private student loan has a fixed interest rate, then that rate will never go up or down. If your private student loan has a variable interest rate, then that rate will vary depending on an index rate disclosed in your application. If the interest rate on the new private student loan is less than the interest rate on your government loans, your payments will be less if you refinance.
If you don’t pay a private student loan as agreed, the lender can refer your loan to a collection agency or sue you for the unpaid amount.
Remember also that like government loans, most private loans cannot be discharged if you file bankruptcy unless you can demonstrate that repayment of the loan would cause you an undue hardship. In most bankruptcy courts, proving undue hardship is very difficult for most borrowers.
8 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|3.99% – 11.32%2||Undergraduate, Graduate, and Parents|
|4.50% – 11.35%*,3||Undergraduate and Graduate|
|4.84% – 13.49%4||Undergraduate and Graduate|
|4.25% – 11.30%5||Undergraduate and Graduate|
|4.50% – 9.47%6||Undergraduate and Graduate|
|3.74% – 9.72%7||Undergraduate, Graduate, and Parents|
|4.45% – 12.32%8||Undergraduate, Graduate, and Parents|