Student Loan Types and Interest
The predominant federal student loan types available for graduate/professional school (i.e. veterinary school) are Direct Unsubsidized and Direct PLUS loans. The following table illustrates the various loan types currently available during the 20212022 academic year:
Federal Student Loan Types and Limits:
Loan Type

Interest Rate

Fees

Cost

Loan Limits

IDR Eligible

Direct Grad PLUS (interest accrues during school***)

5.28%

4.236%4.228%

$$$

Up to Cost of Attendance (COA)

Yes

Direct Unsubsidized (interest accrues during school***)

6.28%

1.059%1.057%

$$

$40,500 for 9month term $47,167 for 12month term*

Yes

Health Professions Student Loan (HPSL), Perkins Loans, Loans for Disadvantaged Students (LDS)
(subsidized  no interest accrual during school)

5%

None

$

Variable**

If Consolidated

IDR = incomedriven repayment
* U.S. students who attend foreign veterinary schools can only receive $20,500 per year maximum Direct Unsubsidized loans.
** Check with your school for availability, amounts available, and application requirements.
*** Direct Loans do not accrue interest during the special pandemic forbearance period, in place since March 13, 2020 through at least January 31, 2022.
There are currently only three types of schooldependent federal student loans available to graduate school students that do not accumulate interest during school:
 Health Professions Student Loans (HPSL)
 Perkins Loans The Federal Perkins loan program expired September 30, 2017. New disbursements will be available only if the program is reinstated by Congress.
 Loans for Disadvantaged Students (LDS)
These loans are inconsistently available depending on the school you attend and your individual circumstances. Check with your school financial aid office to see if you might be eligible for these types of loans. HPSL and LDS are a type of federal student loan that can be consolidated into a Direct Consolidation Loan after school to include in an incomedriven repayment plan. If HPSL or LDS are not consolidated, they can only be paid using a timedriven repayment plan.
Federal Student Loan Interest
While you are in school, Direct Unsubsidized and PLUS loans accumulate interest daily starting from the date you receive each loan (disbursement date). The interest rate is determined by the type of loan and your disbursement date and the amount you receive is net of loan origination fees charged to you at the time of disbursement.
Direct Loan interest rates are based on the high yield of the 10year Treasury note auctioned just prior to July 1st each year. While student loan interest rates change each year, the rate remains fixed for the life of the loan.
For Example:
Federal Direct Student Loans 20212022 Interest Rates
Effective for Loans First Disbursed on or after July 1, 2021 and prior to July 1, 2022
Loan Type

Borrower Type

10Year Treasury Note

AddOn

Fixed Interest Rate

Direct Unsubsidized Loans

Graduate/Professional Students

1.684%

3.60%

5.284%

Direct PLUS Loans

Graduate/Professional Students

1.684%

4.60%

6.284%

10Year Treasury Note Source: https://www.treasurydirect.gov/instit/annceresult/press/preanre/2021/R_20210512_2.pdf
For a list of interest rates in past academic years, review a list of student loan interest rates prior to July 1, 2021.
For a recent history of common veterinary school student loan interest rates, review the VIN Foundation blog post on student loan interest rates.
Daily Interest Rate Factor
Federal student loan interest is calculated using a “simple” daily interest calculation. The interest rate on your loans is divided by the number of days in the year to get a daily interest rate factor.
Most loan servicers use the following daily interest rate factor calculation:
daily interest rate factor= interest rate ÷ 365.25 (number of days in a year)

Inschool Interest
While you are in school, calculate the interest accumulation for each of your Direct Unsubsidized and PLUS loans by counting the days between each loan disbursement date and graduation date. Multiply that number of days by the daily interest rate factor to estimate your inschool interest for each loan.
In–school Interest Projection = Principal balance × Daily interest rate factor × number of days between loan disbursement and your graduation date***

IMPORTANT NOTE: Don't forget to add interest that accrues during your grace period which can add another 180 days (6 months) of interest. You can reduce your grace period interest by using a Federal Direct Consolidation loan to waive your grace period and apply for repayment before your grace period ends. Review the New Veterinary Graduate Student Loan Repayment Playbook found on the VIN Foundation blog.
Login to STUDENTAID.GOV each semester and upload your MyStudentData download file to the VIN Foundation My Student Loans tool to see an estimate of the interest accumulation each month. To estimate your total costs as a student, send your data from My Student Loans to the InSchool Loan Estimator or start a new estimation from scratch if you do not yet have student loans.
Analyzing your student loan costs together with your personal budget will help you understand how much financial aid you need each semester and if there is an opportunity to reduce or return unused funds or reduce future award amounts. Generally, you have 120 days from the disbursement date to return unused/excess award amounts. If you return funds within that 120day window, you will not be charged the interest or fees associated with the disbursed. After 120 days, you will be responsible for all interest and fees associated with your loan disbursement. Borrowing less and returning unused or excess student loan amounts are much less expensive than paying your loans during school.
For example, let’s consider two veterinary students starting at Colorado State University in Fall 2021, borrowing the cost of attendance (COA). Knowing the predominant student loan types and interest rates, we can calculate the interest that will accrue during school and until graduation using the VIN Foundatin InSchool Loan Estimator:
Colorado State student starting 2021 
Direct Unsubsidized loan for firstyear 
Direct Grad Plus loan for firstyear 
Interest on firstyear loans through graduation (~ 5/15/2025) 
Total cost of firstyear loan 
Resident COA = $59,757 
8/23/2021: $20,250 @ 5.28%
1/16/2022: $20,250 @ 5.28%

8/23/2021: $9,629 @ 6.28%
1/16/2022: $9,628 @ 6.28%

$15,660 ^{a} 
$75,417 
Nonresident COA = $84,385 
8/23/2021: $20,250 @ 5.28%
1/16/2022: $20,250 @ 5.28%

8/23/2021: $21,943 @ 6.28%
1/16/2022: $21,942 @ 6.28%

$22,895 ^{a} 
$107,280 
^{a} Accounts for pandemic forberance interest waiver through 1/31/2022
Interest during student loan repayment
Multiply the daily interest rate factor by the average days per month and by your principal balance (disbursed amounts) to get the average interest accumulation per month.
The amount of interest you owe per month depends on the number of days that occur between payments, generally between 28 and 31 days when you’re in repayment. To figure out an average monthly interest accrual, take the number of days per year and divide by twelve months (365.25 ÷ 12 = 30.4) to get average days per month.
Average interest accumulation per month = Principal balance × Daily interest rate factor × Average days per month

Weighted Average Interest Rate
The weighted average interest rate is the sum of interest paid on all debt. The calculation for this rate is to add all interest accumulation across loans and divide by the total loan principal. For example:
Loan Number

Principal

Interest Rate

Interest Accumulation per year

Loan 1

$40,500

5.84%

$2,365.20

Loan 2

$30,000

6.84%

$2,052

Loan 3

$5,000

5.00%

$250

Sum of loans

$75,500

6.18%

$4,664.20

Weighted Average Interest rate across Loans 1, 2 and 3 = $4,664.20 ÷ $75,500 = 6.18%