Graduate and professional school can open doors to new career opportunities, whether you’re pursuing an MBA, earning a doctorate, or working toward a career in medicine, dentistry or law. But taking the next step in your education often comes with a significant price tag.
Tuition is only part of the equation. Housing, books, equipment, licensing exams and other education-related expenses can add up quickly, especially if you plan to attend school full time or complete a demanding professional program.
Scholarships, grants, savings and federal student loans are important places to start when building your education funding plan. But what happens when those resources aren’t enough to cover the full cost?
Private student loans can help bridge the gap between your available financial aid and the cost of earning your degree. Understanding how these loans work, what options are available and how recent changes to federal student lending affect graduate borrowers can help you make a more informed decision.
Start With Your Financial Aid Options
Before applying for a private student loan, take time to understand your school’s total cost of attendance and the financial resources available to you.
- Start by completing the Free Application for Federal Student Aid (FAFSA). Even if you expect to need additional financing, the FAFSA can help determine your eligibility for federal student loans and other forms of financial aid.
- Next, explore funding opportunities that don’t need to be repaid, including scholarships, grants and fellowships. Depending on your program, you may also qualify for graduate assistantships, research positions or employer tuition assistance.
- Federal student loans are another important consideration. They offer benefits that private loans generally don’t, including access to eligible federal repayment plans and certain forgiveness programs. (Note that as of July 1, 2026, Graduate PLUS loans are no longer available to new students, and new borrowing limits were put in place for other federal loans).
For a more detailed overview, read Funding Graduate School in 2026: Options Beyond Federal Loans
Once you’ve explored these options, compare your remaining education costs with the amount of funding available. That gap will help you determine whether additional borrowing is necessary.
How Private Student Loans Can Help Pay for Graduate School
For students whose education costs exceed their available federal aid, private student loans may help cover the difference. Private student loans are offered by financial institutions including banks and credit unions. They can help cover eligible education expenses when other financial aid doesn’t cover the full cost of your program, including tuition, lab fees, room and board, books, technology, and software subscriptions.
Private student loans have different eligibility requirements, interest rates and repayment terms depending on the lender. Your approval and rate will depend on factors such as your credit history, income and whether you apply with a creditworthy cosigner.
How to Compare Private Student Loan Options
If you’re considering a private student loan, don’t choose an offer based on the interest rate alone. Look at the full cost of borrowing and how the loan will fit into your financial plans. Here are five factors to consider.
1. Fixed vs. variable interest rates
A fixed interest rate stays the same throughout the loan term, making monthly payments more predictable. A variable rate may change over time based on its underlying index, which means your interest rate and payment could increase or decrease.
2. Repayment options
Some lenders allow you to defer payments while you’re in school, make interest-only payments or begin full principal and interest payments immediately. If you’re pursuing medicine or dentistry, check whether the lender offers residency or fellowship deferment while you complete your training.
Interest may continue to accrue during deferment, increasing the total cost of your loan. Making payments while enrolled can help reduce the amount of interest that accumulates, although the best choice depends on your budget.
3. Loan fees
Review application fees, origination fees and prepayment penalties, if any. A loan with fewer fees may cost less overall, even if its advertised interest rate is slightly higher.
4. Cosigner requirements
Graduate students may have limited income while enrolled, even with an established credit history. Applying with a creditworthy cosigner may improve your chances of approval or help you qualify for a lower rate. Remember that a cosigner is equally responsible for repaying the debt.
5. Total borrowing and future payments
Estimate how much you’ll need to borrow throughout your program, not just for the first semester. Consider your existing undergraduate loans, anticipated starting salary and other financial obligations when deciding how much debt you can reasonably manage. Some credit union lenders offer a line of credit structure that allows you to apply once and secure funding for the duration of your program, borrowing only what you need as you need it.*
*Subject to annual review and credit qualification. Must meet school’s Satisfactory Academic Progress (SAP) requirements.
For more guidance, read How to Choose a Private Student Loan Without Second-Guessing Yourself.
Should You Use a Private Student Loan for Graduate or Professional School?
Private student loans can be a useful part of your education funding plan when scholarships, grants, savings and federal financial aid don’t cover all your eligible costs. They may be particularly relevant for students entering expensive professional programs or navigating new federal borrowing limits.
The key is to borrow strategically. Explore all available financial aid, compare lenders and loan terms, and estimate your future payments before committing to additional debt.
Your graduate degree is an investment in your future. Taking time to understand your financing options now can help you move toward your career goals with a clearer picture of the costs involved.
Ready to explore your options?
Student Choice connects borrowers with participating credit unions offering private student loan solutions. Compare graduate student loan options to explore available rates and terms.
