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Dental school students may find they need to apply for student loans to fund the remainder of their educations. Both federal and private student loans are available for their needs.

To become eligible for federal loans, they need to fill out their Free Application for Federal Student Aid (FAFSA). They will also have to submit their taxes. If they are applying only for the Direct PLUS Loan or the Federal Direct loan, copies of their taxes won’t be necessary.

Federal graduate and dental school loans are further broken down into non-need-based and need-based. The need-based loan is known as the Health Professions Loan (HPL). Non-need-based federal loans include the Direct Loan, Private Educational/Alternative Loans, and the Direct PLUS loan.

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What are Dental School Loans?

Dental school loans are either private or federal loans made to students in advanced educational programs focused on entering a dental occupation. Federal loans are the primary resource relied upon by students. These include Federal Direct Loans, guaranteed by the U.S. government. Health Professions Student Loans (HPSL) fall within a limited federal loan program that is administered by individual dental schools. Loan awards are made depending on available funding to students who demonstrate great financial need.

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Types of Loans to Pay for Dental School

  • Federal Direct Plus (Grad PLUS) Loans:
    Consider this loan to supplement borrowing from other loan programs (includes direct unsubsidized loans). Interest rates reset every July 1. Interest will then be fixed for the life of the loan. You’ll be able to borrow up to your Cost of Attendance (COA) annually, not including other aid. This may make private loans unnecessary, but they do not cover your food, living arrangements, or other incidentals.
  • Federal Direct Unsubsidized Loans:
    These loans are the basis for many dental student loan portfolios. You may be required to borrow from this program first before you’ll be considered for other forms of aid. The interest rate changes every July 1, then is fixed for the life of the loan. Terms include eligibility for up to $40,500 annually, with a cumulative maximum from all degree programs of $224,000. This annual amount may be pro-rated higher based on budgetary length. This loan is not based on credit.

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  • Loans for Disadvantaged Students (LDS):
    These loans look like the Health Professions Student Loan, with one difference. They are awarded only to students from disadvantaged backgrounds. Speak to your financial aid office for availability and an application.
  • Health Professions Student Loans (HPSL):
    These are federal loans coming from the Department of Health and Human Services (DHHS) and are covered under Title VII. Loans are awarded by your dental school or health professions school. They are based on exceptional financial need; get in touch with your financial aid office for loan availability and an application.

Differences Between Federal and Private

  • How they are funded:
    Your federal student loans are funded via the government’s Department of Education (or private institutions guaranteed by the government to repay your loans if you default). These loans have more student protections (flexible repayment schedules, income-based repayment, and lower interest rates). Banks and other lenders fund private student loans. They set loan terms, interest rates are higher, and you often have less repayment flexibility.
  • Interest rates:
    The Federal Reserve sets federal student loan interest rates. They are fixed and won’t change during the life of your loan. Private loans can have either fixed or variable interest rates. Variable rates can go up or down, based on the economy; this could add a huge amount of interest to your loan.
  • Obtaining a loan:
    Fill out and submit your FAFSA for a federal student loan. This may also let you find out if you qualify for federal grants or other financial aid. Your credit has no effect on getting a loan. With a private loan, your credit report/history affects your ability to get funding. You may also need a co-signer who will take responsibility for your loan if you can’t repay it. No FAFSA is needed for private loans.
  • Decreasing Your Payments:
    If you run into financial difficulty, a federal loan offers more options than a private loan would for repayment. You could be able to defer up to three years; if you work in public service, you may be able to have your loan forgiven. Private loans don’t extend loan forgiveness, though they may offer forbearance or deferment. If it’s too hard to make payments, you may be able to refinance with a lower interest rate.

Differences Between Undergraduate and Graduate Loans

At the graduate school level, you’ll notice some key differences in borrowing, as opposed to borrowing as an undergraduate student.

  • FAFSA for Graduates: You’re considered independent, meaning you don’t need to enter your parents’ tax information.
  • You’ll receive less financial aid in graduate school than you did as an undergraduate.
  • Your borrowing limits are higher.
  • Your interest rates are also higher.

If you are married, born after January 1, 1996, or pursuing a master’s or doctorate degree, you’ll be categorized as independent. You’ll report a lower income because your family won’t affect your Expected Family Contribution (EFC). You’ll also be considered for the federal work-study program, direct unsubsidized loans, and PLUS loans. You also won’t be eligible for the Pell Grant unless you’re enrolled in a post-baccalaureate teacher certification program.

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Your interest rates may be higher than an undergraduate student applying for a student loan. You won’t be eligible for subsidized loans, which means interest rates start to accrue on the first day. If you can, pay the interest only while you’re in school in order to speed up payment after you graduate.

Borrowing Limits on Dental School Loans

It’s a good idea to know what your borrowing limits may be when you start working on a student loan.

  • Federal Direct Unsubsidized Loan:
    Eligible dental students may be able to borrow up to $40,500 per nine-month academic year from the Federal Direct Unsubsidized Loan program. Total aggregate Federal Direct Subsidized and Unsubsidized loan amount for eligible dental students is $225,500.
  • Federal Direct Graduate PLUS Loan:
    The annual loan limit of this loan is the cost of education minus any other financial aid received.
  • Private Educational Loans:
    The terms and conditions (including loan amounts) vary depending on the loan program.

What to Think About When Looking for a Loan


Life can get in the way when you are making your loan payments. If you are unable to make your payments, you have two options:

  • Deferment:
    You postpone repayment and interest stops accruing. A Direct Unsubsidized Loan will continue accruing interest.
  • Forbearance:
    You continue making your monthly payments, but you pay only on the interest. The interest will continue to accrue on every loan type and must be paid monthly.

Apply for deferment or forbearance for each of your student loans and return them to your loan services. If you are found to be eligible, you may need to provide additional documentation and continue making payments until your application is approved.

Interest Rates

Knowing that student loans for graduate school come with higher interest rates, you should know about the different interest rate terms.

  • Fixed rate:
    This rate is locked in from the day you borrow until you make your last payment. If you refinance (consolidate) your loan, the interest rate will reset.
  • Variable rate:
    This rate is more dependent on monetary conditions. It may shift up or down monthly or quarterly, which can affect your monthly payment unexpectedly.

Every federal student loan has a fixed interest rate. Still, interest rates can be set higher than a variable rate is or will be in the future. Variable interest rates change during the life of your loan. Lenders use the London Interbank Offered Rate (LIBOR) to help set new rates.

Loan Fees (Origination or Other)

As with most other loans, federal and private lenders both charge you a loan origination fee. If this term is new to you, this is a fee that is charged by the lender for processing new loan applications. It is charged up front and is compensation for setting the loan up for you. You’ll see them quoted as a percentage of the total loan.

Focusing on your student loans, different student loans come with different fee percentages. A Health Professions Loan has no origination fee.

Eligibility Requirements

General eligibility requirements for a student loan include that you need to be a U.S. citizen or an eligible non-citizen, you must be enrolled in a certificate or degree program eligible for student aid at your university, and you must have a demonstrated financial need for assistance.

Your eligibility for federal student aid may be limited if you have a conviction for a drug offense, have been incarcerated, or if you are subject to an involuntary civil commitment. Maintain your eligibility for federal aid by earning sufficient credits each semester. You also need to fill out a new FAFSA every year.

Repayment Options

With a federal student loan, you have a range of repayment options of which you can take advantage. Your individual needs may be different from those of other graduates. Private loan repayment begins when loans are disbursed. You should start making payments as soon as school starts; you may be able to make interest-only payments, although you may be required to make full payments while you are in school.

  • Income-driven repayment plans:
    Monthly payment is based on family size and your income.
  • Standard repayment plan:
    Payments of the same amount throughout the life of the loan.
  • Graduated repayment plan
    Lower payments at first, then they increase
  • Extended repayment plan:
    Fixed or graduated, loans are paid off within 25 years.
  • Revised Pay as You Earn Repayment Plan (REPAYE):
    Payments are 10% of discretionary income.
  • Pay as You Earn (PAYE):
    Monthly payments are 10% of discretionary income, never more than you would pay under 10-year Standard repayment plan.
  • Income-Based Repayment Plan (IBR):
    Monthly payments are either 10 or 15 percent of discretionary income. When you received your first loan affects this percentage.
  • Income-Contingent Repayment Plan (ICR):
    Monthly payment will be the lesser of 20% of discretionary income or amount you would pay on a repayment plan with fixed payment over 12 years, adjusted to your income.

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  • Income-Sensitive Repayment Plan:
    Monthly payment is based on annual income; loan will be paid in full in less than 15 years.

Sallie May Graduate Dental School Loans

Sallie Mae loans are private, so they have fewer repayment options for you. Interest rates at this level are also higher. These loans cover dental school expenses in dentistry, prosthodontics, endodontics, periodontics, oral and maxillofacial surgery, pediatric dentistry, and orthodontics. Sallie Mae’s Dental School Loan has more benefits than the Federal Direct Grad PLUS Loan.

Why Sallie Mae for Graduate Loans/Dental School Loans

Sallie Mae has created a plan with no origination fees, competitive interest rates, multiple payment options, and extended payment terms. It has also included a plan for no pre-payment penalties.

Sallie Mae’s repayment terms run 20 years with additional flexibility. In addition, students receive a 36-month grace period after graduation to begin making payments; during fellowships or residency, an additional 48 months of deferment are made available. Students who opt to begin making interest-only payments while in school are eligible for an interest rate that is 0.50% lower.

Repayment Options

  • Pay Later:
    deferred repayment option allows you to defer payments while you’re in school and during your 12-month grace period after graduation. After your grace period ends, you begin paying both principal and interest.
  • Pay a Little and Save:
    This fixed repayment plan allows you to pay $25 every month you’re in school and during your grace period. You’ll be able to save on your total loan cost as compared to the deferred repayment plan.
  • Pay Interest and Save Even More:
    This interest repayment option allows you to pay your Dental School Loan interest monthly while you’re in school and during your grace period. Your interest rate will be 0.50% lower than with the deferred repayment option and 0.25% lower than with the fixed repayment plan.

Features and Benefits

  • Pay no origination fees or penalty for paying your Dental School loan before its due date.
  • Lower your loan cost with a 0.25% interest rate deduction if you enroll in and make monthly payments by auto debit.
  • Apply to release your cosigner after you graduate and make 12, on-time interest and principal payments. You also need to meet particular credit requirements
  • Receive your quarterly FICO credit score for free to both you and your cosigner
  • Use the Sallie Mae Dental Residency and Relocation loan to pay for your school-certified dental school costs, plus residency expenses. Use a single, established lender