Can I Get a Student Loan for an MBA?
Earning an MBA, or other graduate degree, is an exciting step toward career advancement, higher salaries, and leadership opportunities. However, the cost can be daunting, with tuition, fees and living expenses quickly adding up. Careful financial planning is key to reducing stress and achieving your MBA without overwhelming debt.
If you’re wondering if you can get a student loan for an MBA, then this guide is for you. Multiple loan options are available, including federal student loans, state-specific loans and private loans. Each option has different eligibility requirements, interest rates, and repayment terms.
Read on to learn more about the different student loans available for graduate students so you can make an informed decision about financing your education.
Federal Student Loan Options
Federal student loans are often the first choice among MBA students due to their fixed interest rates, flexible repayment plans and government-backed benefits.
There are two primary types of federal student loans for graduate students:
Grad PLUS Loans
A Grad PLUS Loan is a federal loan for graduate and professional students. It helps cover expenses not met by other financial aid.
Who is Eligible?
Applicants with credit challenges may still be eligible if they meet additional requirements. To qualify, students must complete the Free Application for Federal Student Aid or FASFA and be enrolled at least half-time in a graduate or professional program at an eligible institution.
How Much Can You Borrow?
Students can borrow up to the full cost of attendance minus any other financial aid received. For loans disbursed between summer 2024 and spring 2025, the fixed interest rate is 9.08% with a loan fee of 4.228%, to be deducted from each disbursement.
How To Apply
Complete the FAFSA.
Apply for a Grad PLUS Loan online through the U.S. Department of Education.
Complete Entrance Loan Counseling for Graduate PLUS Borrowers (FSA ID Required).
Electronically sign your Master Promissory Note (Loan Agreement - FSA ID Required).
Direct Unsubsidized Loans
Direct Unsubsidized Loans are another federal loan option available to graduate students. Unlike subsidized loans, these loans do not require financial need, but students are responsible for all accrued interest.
Who is Eligible?
Direct Unsubsidized Loans are available to undergraduate and graduate students and do not require a credit check. Students must be enrolled at least half-time in a degree program.
How Much Can You Borrow?
Loan amounts depend on the cost of attendance and other aid you receive, there are yearly maximums students can receive. The interest rate for loans disbursed during the 2024-2025 academic year is 7.05%. Interest accrues while in school and during deferment periods.
How to Apply
Submit the FAFSA.
Accept the loan through your school’s financial aid office.
Complete Entrance Loan Counseling (FSA ID Required).
Electronically sign your Master Promissory Note (Loan Agreement - FSA ID Required).
Things to Consider
Loan limits apply, meaning some students may need additional funding sources. Moreover, interest accumulates while in school unless you make interest payments. Loan repayment begins six months after graduation, leaving school or dropping below half-time status.
State-Specific Loan Programs in Texas
If you’re a Texas resident, you may be eligible for the College Access Loan (CAL) Program, a state-funded loan program.
College Access Loan (CAL) Program
Who is Eligible?
Texas residents enrolled at least half-time in an eligible program may qualify. Most students require a credit-worthy cosigner and must complete the FAFSA or TASFA.
Loan Terms
The fixed interest rate for 2024-2025 is 6.30%. There is no origination fee, and loan repayment begins six months after graduation.
Private Student Loan Options
For students who don’t qualify for federal or state loans or need additional financial aid for graduate school, private student loans are an alternative worth exploring.
Higher Education Servicing Corporation’s Texas Extra Credit Graduate Student Loan Program
Who is Eligible?
Texas residents attending approved schools nationwide may apply. Graduate students in MBA, law, medical, and other professional programs are eligible. Borrowers must meet income and credit requirements, though a cosigner can be added.
Loan Terms
Students can borrow between $1,000 and $65,000 annually. There are no origination or application fees, and repayment terms include 5, 10 or 15-year options.
Repayment Options
Immediate Repayment requires monthly payments once the loan is fully disbursed.
Interest-Only Repayment allows deferment of principal payments while in school & enrolled at least ½ time at an eligible institution.
Fully Deferred Repayment lets students defer principal and interest payments for up to 66 months, or until the student graduates or drops below halftime enrollment.
Financial Planning and Budgeting Tips
Effective financial planning is crucial for minimizing the economic challenges of an MBA. Adopting these smart budgeting strategies and seeking additional funding sources can significantly alleviate financial stress throughout your MBA journey.
Plan Early
Start saving 2-3 years in advance and set aside a dedicated MBA fund with automated monthly contributions. Small savings each month can accumulate into a significant financial cushion.
Explore Scholarships and Grants
Look into merit-based and need-based scholarships and industry-specific grants that can help offset tuition costs. Many programs offer institutional scholarships and financial aid for MBA students. Moreover, organizations like the Forté Foundation and The Consortium provide financial assistance to eligible students.
Maximize Employer Benefits
Some companies offer tuition reimbursement or student loan repayment assistance as part of their employee benefits. Speak with your HR department to see what options are available to you.
Create a Comprehensive Budget
Utilize budgeting apps to track your income and expenses effectively. Prioritize essential costs, reduce discretionary spending and identify areas for savings.
Use Credit Cards Wisely
While they can help cover short-term expenses, paying off balances in full each month is essential to avoid high-interest debt. Consider credit cards with no foreign transaction fees if you plan to study abroad or travel for internships.
Let Us Make Funding Your MBA a Possibility
Financing your postgraduate studies may seem overwhelming, but several MBA loans are available to help make it achievable. By planning early, exploring scholarships and understanding your various loan options, you can invest in your future without unnecessary financial stress.
If you’re looking for flexible, low-cost MBA student loans, HESC’s Texas Extra Credit Graduate Student Loan Program might be a good fit. Apply Now or Contact Us today to learn how we can help make your MBA dreams a reality. For additional guidance, check out our Financial Aid Glossary to confidently navigate your options.