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If you’re reading this, you don’t need us to point out the obvious — medical school is expensive. In fact, 76% of students need medical school loans to make it through. According to the American Association for Medical Colleges (AAMC), your medical school debt may top $300,000 if you go to a private school. Looking for the cheapest medical student loans is not just a smart idea; it’s essential if you’re going to thrive in the first decade of your practice. We’ve ranked the best medical school loans below using our SimpleScore methodology, which compares variable rates, fixed rates, transparency, loan amounts and fees.
Medical school students can save time on reapplying each year and spend more time studying anatomy with Citizens One’s multi-year approval plan.
3 / 5.0
SimpleScore Citizens One 3
Max Fixed APR 3
Loan Amount 1
Apply once and get it over with is the genius behind Citizens One multi-year approval, which lets you borrow up to $350,000 for your entire med or dental school career.
Citizens One has a lot going for it, including low fixed rates, no fees, loyalty auto and home loan discounts of up to 0.50% and flexible loan payment options. Make interest-only payments while still in school or defer the whole thing (but interest will accrue) for up to eight years — it’s your choice. Check out our Citizens Bank student loans review to find out more about the multi-year process.
Variable Rate Disclosure: Variable Rates advertised are based on the one-month London Interbank Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business day, of the preceding calendar month.As of June 1, 2021, the one-month LIBOR rate is 0.09%.Variable interest rates will fluctuate over the term of the loan with changes in the LIBOR rate, and will vary based on applicable terms, level of degree and presence of a co-signer. Your final variable rate may be based upon the 30-day average SOFR index, as published by the Federal Reserve Bank of New York. The maximum variable rate is the greater of 21.00% or Prime Rate plus 9.00%.
Fixed Rate Disclosure: Fixed rate ranges are based on applicable terms, level of degree, and presence of a co-signer.
Lowest Rate Disclosure: Lowest rates require a 5-year repayment term, immediate repayment, a graduate or medical degree (where applicable), and include our Loyalty and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Rates are subject to additional terms and conditions, and are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
Take your time before stepping into your white coat and scrubs — Sallie Mae let’s part-time students take out medical school loans.
4.2 / 5.0
SimpleScore Sallie Mae 4.2
Max Fixed APR 3
Loan Amount 5
Sallie Mae offers flexible repayment options, including a 36-month grace period, plus 48 months deferment during your residency and a 12-month interest only loan option.
Sallie Mae takes it easy on recent graduates, allowing you to defer the loan through a four-year residency and giving you a three-year grace period to let you get established in your practice once you graduate. You can make interest-only payments, pay nothing or just pay $25 a month depending on your budget. Medical students can also take their time on their course load, as Sallie Mae offers financing even for part-time students. Read the full Sallie Mae student loans review to learn more.
It’s great that CommonBond has a social conscience, but the origination fee makes this loan more expensive than some of the rest.
$10 or 5% late fee
4.2 / 5.0
SimpleScore Commonbond 4.2
Max Fixed APR 4
Loan Amount 5
CommonBond lets you know the rate you’ll qualify for before it does a hard credit inquiry, so it’s worth seeing what a medical loan is going to cost.
CommonBond doesn’t require you to have a cosigner on medical school loans, which is a nice feature for people who need to go it alone. Another nice feature: When you take out a loan or refinance, CommonBond will pay for a child to be educated in the developing world. Pay as little as $100 a month during residency and postpone payments for up to 12 months during the life of the loan. Just be aware this lender charges a 2% origination fee. Learn more about CommonBond student loans.
Best for medical school loan refinancing – Splash Financial
Splash Financial takes that medical school debt you have and reduces it with low interest rates.
as low as 2.49%
as low as 1.88%
3.5 / 5.0
SimpleScore Splash Financial 3.5
Max Fixed APR 4
Max Variable APR 3
If you got stuck with a high loan rate in medical school, Splash Financial can help you refinance to a lower rate while you’re in residency.
Who knew there was a dedicated medical loan refinance lender? Well, there is — and it’s Splash Financial. A soft credit pull is required to know exactly what your interest rate will be. Splash Financial lets you pay as little as $100 a month during your residency (up to 84 months), and it will consolidate all your medical loans into one convenient payment. It’ll also reward you $250 when a referred friend successfully refinances their loan. Find out more about Splash Financial’s student loan refinancing products.
Fixed APR: Annual Percentage Rate [APR] is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Fixed Rate options range from 2.88% (without autopay) to 7.27% (without autopay) and will vary based on application terms, level of degree and presence of a co-signer. Rates are subject to change without notice. Fixed rate options without an autopay discount consist of a range from 2.88% per year to 6.21% per year for a 5-year term, 3.40% per year to 6.25% per year for a 7-year term, 3.45% to 5.08% for a 8-year term, 3.89% per year to 6.65% per year for a 10-year term, 4.18% per year to 5.11% per year for a 12-year term, 4.20% per year to 7.05% per year for a 15-year term, or 4.51% per year to 7.27% per year for a 20-year term, with no origination fees. The fixed interest rate will apply until the loan is paid in full (whether before or after default, and whether before or after the scheduled maturity date of the loan). Variable APR: Annual Percentage Rate [APR] is the cost of credit calculating the interest rate, loan amount, repayment term and the timing of payments. Variable rate options range from 1.99% (with autopay) to 7.10% (without autopay) and will vary based on application terms, level of degree and presence of a co-signer. Our lowest rate option is shown with a 0.25% autopay discount. Our highest rate option does not include an autopay discount. The variable rates are based on the Variable rate index, is based on the one-month London Interbank Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business day, of the preceding calendar month. As of April 27, 2020, the one-month LIBOR rate is 0.43763%. The interest rate on a variable rate loan is comprised of an index and margin added together. The margin is a fixed amount (disclosed at the time of your loan application) added each month to the index to determine the next month’s variable rate. Variable rate options without an autopay discount consist of a range from 2.01% per year to 6.30% per year for a 5-year term, 4.00% per year to 6.35% per year for a 7-year term, 2.09% per year to 3.92% per year for a 8-year term, 4.25% per year to 6.40% per year for a 10-year term, 2.67% per year to 4.56% per year for a 12-year term, 3.44% per year to 6.65% per year for a 15-year term, 4.75% per year to 6.93% per year for a 20-year term, or 5.14% per year to 7.10% for a 25-year term, with no origination fees. APR is subject to increase after consummation. Variable interest rates will fluctuate over the term of the borrower’s loan with changes in the LIBOR rate, and will vary based on applicable terms, level of degree earned and presence of a co-signer. The maximum variable rate may be between 9.00% and 16.00%, depending on loan term. The floor rate may be between 0.54% and 4.21%, depending on loan term. These rates are subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
If you’re interested in joining the private healthcare system in the U.S. as a doctor or nurse, Ascent can help you climb that ladder to your dream medical job.
3.8 / 5.0
SimpleScore Ascent 3.8
Max Fixed APR 3
Loan Amount 3
Ascent gives you plenty of ways to finance your private medical school loans, and it has a long forbearance period to boot.
Ascent not only allows you a 36-month grace period once you graduate from medical school, but it also gives you 24 full months of forbearance, which is twice what most lenders offer. And international and DACA students are eligible for medical school loans with Ascent, making it a very accessible lender for students who want to study in the U.S.
What is a medical school student loan?
Medical school loans are specifically designed to help students defray the enormous cost of obtaining a degree in the medical profession. There are two kinds of loans available: federal student loans and private student loans.
If you meet certain income qualifications, determined by filling out a FAFSA form, and you attend a participating school, you may be eligible for a health professions student loan subsidized by the federal government.
All medical students, regardless of income, are eligible for two other types of federal loan programs, the federal direct unsubsidized loan program and the federal PLUS loan program. Unsubsidized loans have lower interest rates, and repayment plans based on income, but you will tap out at $20,500 a year, or $138,500 total. The PLUS program lets you borrow more, but you will pay a higher interest rate.
Private loans are available through a number of lenders and can be competitive with the rates charged by PLUS loans, especially if you have excellent credit.
How medical school loans work
Federal unsubsidized loans have fixed interest rates that fluctuate between 4% and 8%, depending on when you secure the loan. In 2020, the rate is 4.30%. PLUS loans also have a fixed interest rate, currently 5.30%. The main difference between unsubsidized and PLUS loans, though, is the fee structure. You’ll pay 1.059% in fees for unsubsidized loans and a whopping 4.236% in fees for a PLUS loan.
Private medical school loans work much the same way any unsecured debt obligation does. The lender will run a hard credit inquiry to determine the amount of interest you’ll pay, which is based on your credit history. The interest rate can be fixed or variable.
Medical school loans are deferred until you leave school; you must start repaying them within six to nine months after graduating. But you can defer payments while completing a residency or fellowship. Federal loans grant eligible borrowers an interest subsidy, which, in some cases, completely wipes out a portion of the interest that would accrue on the loan. With private loans, interest accrues from day that funds are disbursed.
Medical students take on huge amounts of debt. In 2019, physicians graduated with a median debt obligation of $194,000. If you go to a private medical school, that figure can be much higher. However, medical school is a high-risk, high-reward financial decision. Nurse practitioners can make about $125,000 a year, while doctors earn $313,000 a year on average. The high earning potential makes medical school worth it for some students, and securing a high-paying job can offset the amount of medical school debt.
How to choose the best medical school loan for you
Fill out the FAFSA form. Some of the lowest interest rate federal loan programs, including Loans for Disadvantaged Students and Primary Care Loans, are available to students who meet certain qualifications. Determining your eligibility for these federal health professions student loan programs should be the first thing you do.
Decide if you want to pursue loan forgiveness. To qualify for a federal or state loan forgiveness program, you need to be eventually employed full-time at a government agency or qualifying 501(c)(3) non-profit organization. Only federal loans are eligible for loan forgiveness; you can’t pursue this route with private medical school loans.
Max out on federal unsubsidized loans first. These are your go-to loans, and you should take out the maximum allowed amount per year before seeking other lending options.
Compare federal PLUS loans with medical school loans by private lenders. Federal loans should be the foundation of your borrowing strategy, as they have low interest rates, and the interest doesn’t accrue while the loan is deferred. But they probably won’t be enough to pay for everything, and you may need to supplement them. Because federal PLUS loans have a stiff fee, on top of a fixed interest rate, private loans may be a better deal if you have an excellent credit score. If you have bad credit, you can still qualify for PLUS loans as long as you don’t have an adverse credit history.
Compare private lenders. You should look for low (or no) fees, fixed interest rates and the ability to refinance. An easy to navigate website is a bonus.
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One thing to consider is your annual budget, including medical school tuition, room and board and other expenses. Another important thing to realize is the total debt payment you’ll need to make once you are out in the world, earning money. Finally, you want to be mindful of the federal unsubsidized loan caps.
Yes! You can borrow up to $20,500 a year, or $138,500 in aggregate, in federal unsubsidized loans. (You may be able to borrow up to $224,000 if you pursue certain types of medical training.) You can also borrow federal PLUS loans to supplement this amount if you don’t have an adverse credit history or blemishes on your credit report.
Too long, didn’t read?
Once you hit the cap on federal unsubsidized medical school loans, private medical school loans may be your best bet, especially if you have excellent credit. If you must rely on private loans for a significant percentage of your total medical school debt, your best bet is to budget carefully and seek out the cheapest medical student loans you are able to qualify for.
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Valerie Fulton is a freelance writer who specializes in personal finance, real estate, higher education, home improvement and business copy. Her work has been published at Veros Real Estate Solutions, Bluehost, Sears, UPS, Movoto, Peak Communications and the University of Tennessee. Every summer, she travels from Austin, Texas to the coast of Maine with her two standard poodles in order to manage the vacation property she bought for a steal several years ago.
Courtney Mihocik is an editor at The Simple Dollar who specializes in personal loans, student loans, auto loans, and debt consolidation loans. She is a former writer and contributing editor to Interest.com, PersonalLoans.org, and elsewhere.