For those who are not awarded scholarships or grants to attend pharmacy school, student loans are likely to be the best source of funding for tuition and fees.
The main sources of loans for pharmacy students are:
These loans are all different in their terms, the amount of money offered, repayment scenarios, and interest rates.
Students can apply for the Pharmacy Health Profession Student Loan (HPSL). These students will be considered for this loan if they complete the parental information section of the Free Application for Federal Student Aid (FAFSA) and submit a copy of their and their parents' federal tax returns, including W-2 forms. The loan amount varies every year and is based on the availability of funds. This is a subsidized loan, meaning that it will not accrue interest while one is still enrolled in school and that it has a fixed interest rate of 5% over a 10-year repayment period that begins one year after graduation. Also, the loan will go into repayment status if the student falls below half-time enrollment.
As with the HPSL, students can apply for the Loans for Disadvantaged Students (LDS) if they complete the parental information section of the FAFSA and submit a copy of their and their parents' federal tax returns, including W-2 forms. Loan amounts differ from year to year and are based on very limited funds. This is also a subsidized loan, with the same repayment terms as for the HPSL.
Federal Direct Stafford Loans are available to U.S. citizens and permanent residents. This loan may be subsidized or unsubsidized, and the decision is made based on demonstrated financial need. The interest rate for this loan is fixed at 6.8%. Students pursuing a PharmD degree can receive a maximum of $33,000 annually, up to $8,500 of which can be subsidized.
Federal Direct Graduate PLUS Loans are also available to U.S. citizens and permanent residents. This loan helps fill the gap for students who have applied for and been awarded a Federal Direct Stafford Loan but who are still in financial need. This loan is credit based, not need based. The current interest rate is fixed at 7.9%, with a 10-year repayment plan that can be extended based on the amount of money borrowed. There may be additional fees involved with this loan, such as a 4% Federal Origination and Federal Default Fee.
Finally, there are private financing programs for which U.S. citizenship or permanent residency is not required. These loans are unsecured educational loans provided by private financial institutions, like banks and credit unions. Because the repayment terms of federal student loans are typically more favorable, students should apply for those first and then apply for a loan from a bank or credit union if necessary. Interest rates for these loans are based on the credit rating of the borrower and can vary on a monthly or quarterly basis. Repayment of these loans typically starts after the loan has been disbursed, whether or not the student is still enrolled in school, however deferments may be available from some lenders.
Student loans are likely to be a large source of financial aid for many students at pharmacy schools. One should research the loan amounts and terms before accepting any offers.
Last Updated: 08/20/2013