As the federal government scales back financial support for graduate education, Minnesota is stepping in with a new borrowing option for students pursuing advanced degrees — one state officials say is designed to be more accessible and affordable than what remains of the federal loan landscape.
The Minnesota Office of Higher Education launched the SELF Grad Loan this month, offering fixed-rate loans to graduate students attending participating colleges and universities in the state. The program arrives in the wake of the federal elimination of the Grad PLUS Loan, which had allowed graduate students to borrow up to the full cost of attendance, and the lowering of caps on other federal loan options — changes that left many graduate students with fewer paths to financing their education.
Unlike federal loans, which set interest rates based on broader economic benchmarks, the SELF Grad Loan ties its rates to two factors: whether the borrower has a co-signer, and the repayment term selected. Borrowers may choose a 10-, 15-, or 20-year repayment term. As of June 2, rates with a co-signer range from 6.00% APR for a 10-year term to 6.95% for a 20-year term. Without a co-signer, rates run higher, from 7.25% to 7.95% depending on the term. Notably, rates are not determined by credit score, though borrowers must still pass a credit review and meet a minimum FICO score of 670 unless a co-signer is added.
The program distinguishes between two categories of graduate borrowers. Students enrolled in programs in advanced dentistry, dentistry, medicine, pharmacy, and veterinary medicine may borrow up to $300,000 cumulatively with no annual cap, and can apply for an extension period during residency or training. All other graduate students are eligible for up to $50,000 per year, with a cumulative ceiling of $150,000. A $15 minimum payment begins while the student is still enrolled.
The loan is available to Minnesota residents attending a participating school, as well as non-resident U.S. citizens and permanent residents physically enrolled at a qualifying Minnesota institution. Residents of Colorado, Connecticut, Maine, and Puerto Rico are not eligible.
The program represents one of the more concrete state-level responses to the Trump administration’s retreat from graduate financial aid — an effort by Minnesota to backstop students who might otherwise face significant gaps in funding. For graduate students already navigating an expensive and often precarious path to an advanced degree, the loss of the Grad PLUS Loan has been a serious blow, and the SELF Grad Loan’s fixed rates and credit-score-independent structure offer at least some degree of predictability in an uncertain landscape.
Still, the program is not without its limitations. The credit review requirements — which exclude borrowers with prior bankruptcies, certain delinquencies, or defaulted student loans — may put the loan out of reach for some students, particularly those from lower-income backgrounds who are statistically more likely to carry financial blemishes. And while the rates compare favorably to many private loan options, they remain higher than what many students had access to through federal programs.
For students who qualify, applications are available through the Minnesota Office of Higher Education’s SELF website.
