Various estimates put the average annual tuition fees for grad school at $30,000 to $40,000. According to the New America Foundation, a non-partisan think tank, 58% of graduate students borrow for grad school. Graduate degree recipients leave school with an average of $70,000 in debt, about $50,000 of which can be attributed to graduate school itself.
"My advice, in most cases, is to take the federal student loan first before you even consider a private student loan. It’s not always true, but the federal student loan is generally the better option. It has a much more flexible repayment and, this year especially, the rates on these loans are pretty low. There may be occasions where you can get a cheaper loan from a private lender but, for most borrowers, this wouldn’t be the case." -Kevin Walker - CEO and Founder at Collegefinance.com
We’re not telling you all this to scare you off grad school, but rather to stress the importance of finding the right lender before beginning our graduate studies. The difference between 3% and 4% APR or a repayment term of 5 years or 15 years mightn’t sound like a big deal right now, but it can make thousands of dollars of difference later in life.
The 5 Best Lenders for Student Loans for Grad School
Here are our recommendations for the 5 best providers of private student loans for grad school.
1. Credible
Type of lender: Marketplace
Products: Graduate loans, refinance
APR from: Cover up to 100% of your school-certified costs after financial aid
Repayment terms: 5-20 years
Cosigners accepted: Yes
Credible is an online lending marketplace that helps graduate students get pre-qualified for the best student loans for their needs. It takes only a couple of minutes to get pre-qualified with Credible. All you need to do is fill out a short online form with information about yourself (and any cosigner), your studies, and finances. Within seconds, Credible will show you a list of offers from its network of vetted lenders.
This platform is geared toward applicants with very good to excellent credit. A co-signer can be a spouse, relative, parent or any adult that is a US citizen or permanent resident alien. According to Credible, 85% of its applicants bring a cosigner, giving them a 3-times better chance of being offered a good rate.
Why go with Credible? It offers market-beating rates if you or your cosigner have excellent credit.
2. Earnest
Type of lender: Direct
Products: Private student loans, student loan refinancing
APR from: Pay no prepayment penalties or any fees for origination, disbursement, and late payments
Repayment terms: 5-20 years
Cosigners accepted: Yes
Earnest is something of a new kid on the block, having been founded in 2013 with the stated goal of helping students and all types of other borrowers better their financial future.
Earnest secures private student loans in addition to student loan refinance, and if you’re looking to apply, you can receive a rate quote online in as little as 2 minutes. You can also get an eligibility check that won’t affect your credit rate, so if you’re looking to get a loan for graduate school you can test the waters with Earnest risk free.
Some of the perks are a 9 month grace period—during which you don’t have to make any payments—the ability to skip a single payment each year, and a .25% discount for autopay.
Earnest has relatively tough credit requirements—a score of 650 or more—if you want to go it alone. On the other hand, if you have a cosigner you can get a loan even with a lower credit score.
Why go with Earnest? It’s a flexible lender, and the 9-month grace period and ability to skip a payment are 2 quality perks.
3. SoFi®
Type of lender: Direct
Products: Private student loans, undergrad student loans, refinancing
APR from: Flexible repayment options- pay off your student loan either during or after the school year
Repayment terms: 5-15 years
Cosigner accepted: Yes
SoFi was founded by a group of recent Stanford business school graduates back in 2011 with an eye on making it easier for people to pay back their student loans.
This is pursued through a number of measures that can make repaying your loan easier. The company features a number of discounts, including a 0.25% interest rate reduction if you sign up for automated payments. And to sweeten the deal, SoFi also has no fees at all—not for origination, application, prepayment or for being late with your payment.
Passing the initial application for a loan with SoFi should only take you a matter of minutes. After that, your application is sent to your school for verification, and SoFi estimates that the entire process should take around 4-6 weeks.
Why go with SoFi? SoFi offers a number of discount options—and never charges you any fees.
4. College Ave Student Loans
Type of lender: Direct
Products: Graduate loans, parent loans, refinance
APR from: 3.99% - 14.96% fixed APR
Repayment terms: 5-15 years
Cosigners accepted: Yes
College Ave is an online lender that has been offering graduate loans and other types of student loans since 2014. All its loans are underwritten by Firstrust Bank or Safra Bank, whichever can best accommodate the applicant. College Ave offers highly competitive rates and its website offers full transparency on rates, fees, and other details.
A couple of things make College Ave stand out from the crowd. Firstly, it offers parent loans, which are designed for parents wanting to fund their child’s education. Parent loans can be applied to grad school as well as to undergraduate degrees. Second, College Ave offers 4 flexible repayment options: principal and interest; interest-only payment while you’re in school; flat $25 monthly payments while you’re in school; and deferred payments, where you only begin paying after finishing grad school.
Why go with College Ave? It’s very flexible when it comes to repayments, offering 4 different ways of paying back the loan.
See the full College Ave review
5. LendKey
Type of lender: Marketplace
Products: Graduate loans, refinance
APR from: Take out a student loan with a smaller community bank or a credit union instead of large banks
Repayment terms: 5-15 years
Cosigners accepted: Yes
LendKey (formerly Fynanz) is a lending platform that connects borrowers with graduate loans and refinancing options from a network of community lenders. LendKey works with more than 300 credit unions and community banks to find extremely low borrowing rates for graduate students.
A credit union is a financial co-operative that is owned and operated by its participants. Most credit unions charge their members a monthly or annual fee on top of the costs of loans and other financial products and services. Some credit unions require that a person meet certain conditions in order to become a member, such as military service or working in a certain profession such as teaching.
Why go with LendKey? To find market-beating rates from hundreds of participating credit unions and community banks.
How to Find the Best Student Loans for Grad School
The golden rule of finding a student loan for grad school is to compare lenders. Before agreeing to a student loan, line a few lenders up side by side and see how they compare to one another on rates, fees, repayment terms, and other features. If you’re not sure about your ability to make monthly payments before finishing grad school, ask about their repayment and deferment options. And always remember to use a loan calculator (which most of the above lenders provide for free) to calculate the overall cost of your loan as well as the monthly payments.
Compare top private student loan options
SoFi Disclaimer
*Interest Rates: Eligibility and Important Details. Fixed rates range from 3.99% APR to 14.83% APR with 0.25% autopay discount. Variable rates range from 5.99% APR to 15.86% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable interest rates are capped at 17.95%.
SoFi rate ranges are current as of 9/3/24 and are subject to change at any time. Your actual rate will be within the range of rates listed above and will depend on the term and type of repayment option you select, evaluation of your creditworthiness, income, presence of a co-signer (if applicable) and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers.
Check out our eligibility criteria at https://www.sofi.com/eligibility-criteria/. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases.
The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi.
