The Department of Education administers several loan programs for which medical students may be eligible. The majority of these programs are authorized under Title IV of the Higher Education Act (HEA). The three main types of federal student loans available for medical students are Unsubsidized Stafford Loans, GradPLUS Loans, and HRSA Primary Care Loans. Eligibility for these loans is based on the data provided on your FAFSA form. All current federal student loan interest rates are available on the Department of Education website.
IMPORTANT NOTE: Be sure to always go through Connect Carolina to complete forms and applications pertaining to loans — this is very important, as it is how we keep your records (and your to-do list) up-to-date and accurate.
Unsubsidized Stafford Loans
The Department of Education offers unsubsidized Stafford loans for medical students who cannot meet their expected share of educational costs, are not eligible for need-based aid, or want to pursue all aid available to meet their financial need as determined by the Financial Aid Office. Interest on Unsubsidized Stafford Loans begins to accrue from the date of disbursement, so you are encouraged to carefully consider how much money is needed before applying. Unsubsidized Stafford Loans have better interest rates and loan terms than many private loans.
Stafford loans for medical students have an annually-fixed interest rate based on the 10-year Treasury note — 1.55 percentage points higher than undergraduate loans. For loans first disbursed on or after July 1, 2017, and before July 1, 2018, the interest rate is 6.00 percent. Unsubsidized Stafford loans for medical students are limited to $40,500 annually. More than likely, you will exhaust total Stafford Loan eligibility before meeting the total cost of education. At this point, you may want to consider commercial alternative loans or the Federal GradPLUS Loan. Staff in the Financial Aid Office can advise you at this step.
Medical students may also take out GradPLUS loans, also called Graduate PLUS Loans, which are unsubsidized loans with annually-fixed interest rates. These are also non-need-based awards. To qualify, you must complete the FAFSA, pass a credit check, and have exhausted all Stafford Loan eligibility. The GradPLUS interest rate is based on the 10-year Treasury note — 2.55 percentage points higher than undergraduate loans. For GradPLUS loans first disbursed on or after July 1, 2017, and before July 1, 2018, the interest rate is 7.00 percent. GradPLUS loans are limited to the total Cost of Attendance as determined by the institution.
HRSA Primary Care Loans
Medical students interested in primary care are eligible for the HRSA PCL program. The PCL offers a 5 percent interest rate to students who agree to train and practice in primary care until the loans are paid off (capped at 10 years). Students who fail to complete the service requirement will revert to a 7 percent interest rate.
Check out these pages for additional information about federal loans: