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GradPLUS |
Private Loans |
| Interest Rate |
Federal GradPLUS interest rate is FIXED at 8.5%. Edamerica's GradPLUS rate is fixed at 8.25% for borrowers who pay by auto-debit with continuous on-time payments.
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VARIABLE interest rate with no cap (depending on state law) and subject to change as often as monthly. May be based on the credit of the borrower and/or co-borrower. Current rates can range from 7.5% to 16% OR HIGHER. |
| Interest Accrual |
Unpaid accrued interest is capitalized at repayment. |
Accrued interest may be capitalized as often as monthly. |
| Borrower |
GradPLUS loan is made to graduate/professional students - NOT PARENTS. |
Private loans are made to students, but credit-worthy co-borrowers are often required. Co-borrower is responsible for any outstanding debt.
Enrollment may be less than half time. |
| Loan Limits |
Up to the cost of education minus other financial aid received. |
Up to the cost of education minus other financial aid received. Limits depend on maximums established by private lenders, as well as borrower and co-borrower credit scores. |
Credit
Requirements |
Based on federal standards. No debt-to-income ratios or credit scoring used. |
Most lenders review debt-to-income ratios and credit scores. Minimum income amounts are also usually required. |
| Death/Disability |
GradPLUS loan can be discharged upon death of borrower or if borrower becomes totally and permanently disabled. |
Private loans are NOT insured against death or disability. Insurance may be available at an extra cost to borrowers. |
Deferment/
Forbearance
Options |
AUTOMATIC IN-SCHOOL DEFERMENT. Interest-only payments or full deferment is available while students are enrolled at least half time and during periods of unemployment or economic hardship. |
Deferment options vary widely and are generally less flexible than GradPLUS loan deferments. Consolidation loans are available but at a variable rate. |
Repayment
Options |
AUTOMATIC IN-SCHOOL DEFERMENT. Repayment begins when borrower ceases to be enrolled at least half time. Up to 25 years to repay based on flexible repayment plans and total amount borrowed. |
Repayment often begins within 45 days of disbursement. Most lenders offer interest-only payment options, and some offer full payment deferment during enrollment. |
Loan
Consolidation |
GradPLUS loans may be consolidated at a fixed rate with other FFELP loans. Consolidation interest rates are based on the weighted average of these loans. |
Many private lenders offer consolidation options, but interest rates are variable and scaled to credit. Generally, borrowers should not combine FFELP loans with private loan consolidation, and deferment eligibility would be lost. |