What is the best graduate student loan program?

There is no one best graduate student loan program. There is a best graduate student loan program for you, for your specific financial needs. Determining which program best suits your needs requires considering a few factors, in order of importance:

Subsidization. Subsidized loans such as the Stafford loan are better than unsubsidized because the federal government pays interest accrued while you are in school. Unfortunately, this option is not available for graduate students as of July 1, 2012.

Lowest cost. Graduate student loans may vary significantly by fees. Determining which loan is the lowest cost requires taking into consideration fees such as guarantee fees, origination fees, and other charges. Carefully check the terms of any loan and make sure when you're comparing that you're doing an equal, apples-to-apples comparison.

Interest rate. Some loans, such as the graduate Stafford loan and graduate PLUS loan, have fixed interest rates that don't change no matter what's going on in the economy or markets. Some loans, such as graduate private student loans, have variable rates that change as the economic indexes they're based on change. What may be a good deal in one year may be a terrible deal in another year.

Flexibility. Consider the repayment options offered. Are payments required while you're in school? Can the principal be deferred? Are alternative repayment programs (graduate repayment or income sensitive, for example) offered?

Choose your loan program according to these different factors for the most affordable options for paying for graduate school.


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