Types of Graduate Student Loans

Students pursuing their master’s or doctorate have two options when it comes to graduate student loans: federal direct unsubsidized loans and private student loans. While the federal government offered Graduate PLUS loans, they’re being discontinued on July 1, 2026, after the One Big Beautiful Bill (OBBB) was signed into law in 2025. In this guide, we break down what you need to know about these graduate student loans and how to apply.

Types of graduate student loans

Graduate students may be eligible for federal direct unsubsidized loans and private student loans.

Federal direct unsubsidized loans

As of July 1, 2026, the only graduate student loans available from the U.S. Department of Education are direct unsubsidized loans, also known as Unsubsidized Federal Stafford Loans. Here’s what you need to know:

• Federal direct unsubsidized loans don’t require you to demonstrate financial need.
• They begin accruing interest right away.
• You must be enrolled at least half-time in a qualifying program.
• Graduate students can borrow up to $20,500 a year in unsubsidized loans.
• There is a total lifetime cap of up to $100,00 for graduate students, which includes any federal loans you took out as an undergraduate.
• Profession students (like those studying law, medicine, and theology) can borrow up to $50,000 annually, limited to $200,000 over the lifetime.

All federal loans have a fixed interest rate, meaning it will remain the same throughout the lifetime of the loan. Between July 1, 2025, and July 1, 2026, the interest rate for direct unsubsidized loans for graduates and professional students is 7.94%. There is also a 1.057% loan fee, which comes out of the money you receive.

Federal loans not available to grad students

Direct subsidized loans are need-based aid where the government covers interest while you’re in school, and they are only available to undergraduates. Direct PLUS loans for graduates will no longer be offered after July 1, 2026.

Private student loans

Private student loans for graduate students come from private lenders, including banks and credit unions. Interest rates and loan terms vary by lender, so it’s important to compare your options before choosing.

You typically need to be a U.S. citizen or permanent resident, reside in the U.S, and attend school in the U.S. to qualify. Your offered terms depend on your credit history and income. Stronger credit with steady income can mean higher loan limits and a lower interest rate. If you lack good credit or income or don’t meet the other requirements, you will likely need a co-signer for private student loans.

Compared to federal loans, private student loans tend to have higher interest rates, and fewer repayment options should you run into financial trouble. They may also require you to borrow a minimum amount.

How do you apply for graduate student loans?

• For federal student loans, graduates need to complete the Free Application for Federal Student Aid (FAFSA). They’ll receive financial aid award letters from their schools, which detail how much they’re being offered in loans.
• For private student loans, graduates must apply directly through financial institutions.

Ready to take the next step?

Student loans may not be enough to cover master’s and doctorate degree expenses, especially with Graduate PLUS loans going away. Other forms of financial aid, such as scholarships and grants, can help cover the gap. Discover all your paying for college options–like scholarships, grants, and work-study—by visiting the Student Hub.

If you’ve exhausted all your other aid options, explore a private graduate student loan. We’ve got options tailored for you whether you’re pursuing an MBA, going to law school, med school, or dental school.