Dreamers Graduate Loan Program

Working with Social Finance, a national non-profit organization, TheDream.US helped create a graduate school loan program for undocumented graduate students with DACA or TPS who want to pursue a graduate degree. Social Finance is the fund manager and Funding U, an education lending platform, is processing the applications and originating the loans. As well in partnership with the national nonprofit, Change Machine, Scholars interested in attending graduate school will have access to FREE virtual 1:1 financial coaching.

Initially, the program will be only open to TheDream.US graduates. As funding allows, the program will be extended to other college graduates with DACA or TPS.

This student-centric loan program is designed to provide financial and educational support, ensuring Dreamers attending graduate degree programs only take on manageable debt to achieve their career aspirations. Additional information on the program can be found below.

The loan application for the 2022-2023 academic year is now open. 

To access the application, go here: https://www.funding-u.com/graduate_loan_applications/new

Guiding Principles of the Loan Program

  • Support you in obtaining graduate degrees: Graduate degree programs can prepare students for well-paying careers with advancement potential but charge high costs of attendance.
  • Do no harm: Identify institutions and graduate degree programs that prepare students for in-demand jobs with starting salaries high enough to support the debt burden.
  • Minimize your debt burden associated with graduate school: Provide you with loans that have an Annual Percentage Rate (APR) based on the federal Grad PLUS Loan Program’s APR.
  • Keep it simple: Taking out a student loan can be confusing and overwhelming. We designed the program to be as simple as possible, so students know exactly what the loan program entails.
  • Pay-it-forward: A portion of students’ repayments will be reinvested to finance loans to enable a permanent, recyclable feature so future students will be able to access loans through this program as well.

Ultimately, this program aims to help students attend graduate school and achieve their professional goals with manageable debt.

Eligibility Criteria for the loan program

Loan program eligibility is based on a student-centric approach. Eligibility criteria is set for students, graduate degrees and institutions, to ensure that students who receive loans earn salaries high enough to repay the debt they are taking on without overburdening them.

Eligibility Criteria for Students

To ensure that any student who receives a loan through this program is in a position to repay their debt upon graduation, the following is required in order to receive a loan:

  • Have been a recipient of TheDream.US Scholarship program (National Scholarship or Opportunity Scholarship)
  • Have been accepted into, or are currently enrolled in an eligible graduate professional degree program, including co-terminal or 4+1 degree programs
  • Have DACA or TPS status
  • Have a Social Security Number (If you do not have this at the time of submitting an application for a loan, we can assist you in getting one)
  • Students may also be subject to knockout criteria based on prior loan defaults, collections, or bankruptcy.

Eligibility Criteria for Graduate Degree Programs

To ensure that students who receive loans are pursuing graduate degrees that will set them up for success, eligible graduate degrees have the following characteristics:

  • Historic average Debt/Income ratio of less than 15%
  • Programs that have strong labor market potential

For a list of eligible graduate degrees, please look here: [LINK TO ELIGIBLE DEGREES

Eligibility Criteria for Institutions

To ensure that students who receive loans are attending institutions that have strong outcomes, eligible institutions have the following characteristics:

  • Institutions with historic 3-year average Cohort Default Rates (CDRs) of less than 8%, though certain partner institutions of TheDREAM.US with CDRs between 8-12% will be considered on a case-by-case basis. CDRs are publicly available here. Note, that we look at the 3-year average CDR to ensure that one down year does not disqualify an otherwise high-quality institution.
  • For institutions that have a historic Cohort Default Rate between 8-12%, additional institutional outcomes have been analyzed, including:
    • Graduation Rates
    • Placement Rates
    • Professional licensing exam pass rates (if applicable – i.e. Bar exam for law, USMLE or COMLEX-USA for medical doctor, etc )
  • For a list of eligible institutions, please look here: [LINK TO ELIGIBLE INSTITUTIONS]

Loan Caps

All loans are subject to annual and lifetime loan caps, which set limits on the maximum loan amount an individual can take out. Loan caps vary based on degree, and are based on the expected debt-to-income ratios, to ensure that students who take out loans will have a manageable debt burden upon graduation.

Annual Program Cap (per loan): This is the maximum loan amount available per year.

Total Program cap (lifetime limit): This is the maximum lifetime loan amount, or the maximum loan amount an individual can take out for an entire program.

For details on the program loan caps [Please refer to the eligible degree programs]

Graduate Loan Program Resources

Below you’ll find a list of educational resources on loans. From the ABC of Loans to evaluating graduate school as an investment.


ABC of Loans

Financial Education Workshop Dreamers Graduate Loan Program


Evaluating Graduate School as an Investment


1.Roadmap to Evaluating Graduate School as an Investment of Money & Time

2.Researching your Career Path

3.Choosing your Degree Program

4.Selecting your Institution

5.Financing Graduate School with Loans


▪Provide insight into how to determine whether graduate school is worth the cost

▪Discuss ways to finance graduate school, including whether private loans would be appropriate

List of Resources for Choosing a Degree and Institution

Podcast Wall Street Journal Is Graduate School Worth the Price? https://podcasts.apple.com/us/podcast/the-journal/id1469394914?i=1000529013786  A WSJ podcast episode that explains why some graduates of elite universities seem to have low post-school earnings and struggle to pay back their student loans.
Article Wall Street Journal Is a Graduate Degree Worth the Debt? Check It Here https://www.wsj.com/articles/is-a-graduate-degree-worth-the-debt-check-it-here-11626355788?mod=searchresults_pos10&page=1  WSJ built a tool where you can enter the graduate program you want to pursue and compare the debt-to-income ratios of all of the schools that offer that program in the US for which there is sufficient data.
Article Wall Street Journal Graduates of Elite Master’s Programs Don’t Earn Enough to Pay Down Loans https://www.wsj.com/articles/graduates-of-elite-masters-programs-dont-earn-enough-to-pay-down-loans-11625838158?mod=searchresults_pos19&page=1  Four key takeaways on why some graduates of elite master’s programs have difficulty repaying their student loans.
Article Wall Street Journal ‘Financially Hobbled for Life’: The Elite Master’s Degrees That Don’t Pay Off https://www.wsj.com/articles/financially-hobbled-for-life-the-elite-masters-degrees-that-dont-pay-off-11625752773?mod=searchresults_pos1&page=2  An in-depth investigation into the master’s programs at some of the top universities in the US and the graduates who fear they won’t earn enough to pay off their six-figure loans.
Article ABA Journal This law school had the widest gap between student debt and graduate earnings https://www.abajournal.com/news/article/this-law-school-had-the-widest-gap-between-student-debt-and-graduate-earnings An analysis of the debt levels law school students assume and their ability to begin to repay that debt 2 years after graduation based on their earnings.
Article The Chronicle of Higher Education The Great Masters Degree Swindle https://www.chronicle.com/article/the-great-masters-degree-swindle Examines the business motivations behind masters degrees for higher education institutions, which lead to high debt and low earnings for many masters degrees.
Article The Atlantic A Crimson Tide of Debt https://www.theatlantic.com/ideas/archive/2021/08/public-universities-debt/619546/ Analyzes the steeply rising costs of public universities using the University of Alabama as a case study and the mounting debt they require students to take on regardless of earnings post-graduation.
Article CNBC Is a master’s degree worth it? https://www.cnbc.com/2021/08/13/is-a-masters-degree-worth-it.html Investigates under what conditions master’s degrees are worth the investment through a series of individual case studies.

1:1 Financial Coaching

In partnership with the national nonprofit, Change Machine, Scholars interested in attending graduate school will have access to FREE virtual 1:1 financial coaching.

Coaches are available to support students in thinking through how to financially plan for graduate school, navigating student loans, managing debt, and much more.

To schedule an appointment with a Financial Coach, please call the toll-free number 1-877-695-4447 and leave your name and phone number. Or click on this link (https://bit.ly/3p8l3R7) to schedule an appointment.

For Scholars planning to take out a loan for the 2022-23 academic year (including summer 2022), attending a 1:1 financial coaching session is the first step in the application process. Be sure to schedule your financial coaching session before loan applications open for the coming academic year.

Frequently Asked Questions

Below you’ll find the most Frequently Asked Questions.

FAQs on the Loan

I’m interested in a part-time graduate program, can I still apply for a loan?

Certain part-time degree programs will be eligible for this loan program, depending on the type of program, the length of the program, and the institution’s historic outcomes.

What are the credit requirements for this program?

We understand that Dreamers may not have strong FICO scores, or other credit indicators. To ensure this program helps Dreamers achieve their professional goals, this loan program will not use credit scores to determine eligibility.

There may be other credit underwriting criteria that will be used to assess a loan application including:

  • Default on any past loan
  • More than one account reported as >60 days past due
  • Collection items/liens/judgments >$500 (except medical)
  • Involvement in any current or prior bankruptcy proceedings
  • No open, active, or unresolved public record item such as a foreclosure, unpaid tax lien, a judgment or repossession
  • No charged off account with an account balance greater than $500 is permitted
  • With limited exceptions, any past due/collections accounts will need to be resolved before approving.

Do I need a cosigner?

At this time, we are not expecting that students will require a cosigner for loans.

I have previously been denied a private student loan, am I eligible for this loan program?

The eligibility for this loan program is different from other private loans offered. If you have been denied a private student loan previously, you may still be eligible for this loan program provided you meet all other eligibility requirements.

I currently have other loan obligations, am I eligible for this loan program?

A key principal of this loan program is to ensure that students are not overburdened by financial obligations. Other loan obligations by themselves do not make a student ineligible for this loan program, as long as the debt obligation does not exceed a reasonable amount of monthly salary. You may be asked to report your other loan obligations as part of your loan application process.

What can I use the funds for?

Loan funds can be used towards the cost of attendance for any eligible graduate degree program. Cost of attendance includes tuition, fees, cost of room and board (or living expenses), costs of books, supplies, transportation and potentially other education-related expenses.

Application Process Questions

Do I need to have been accepted into a program prior to applying for the loan?

Yes, the application process requires you to know which institution you will be attending. If approved, loans will be disbursed directly to the institution’s financial aid office.

Loan Term Questions

What will the term (length) of the loan be?

The loan terms are still being finalized, but will depend on the graduate degree program. Longer programs (such as medical school) may have a repayment period of up to 20 years, while shorter programs (such as an MBA), may have a repayment period of 10 years. Ultimately, the term of the loan will be determined based on the length of your degree program and the loan amount requested.

Currently, we anticipate that there will be a 6 month grace period after graduation before payments are due on loans.

What will the interest rate of the loan be?

The interest rate on this private loan is still being finalized, but we expect it to be based on the federal Grad PLUS loan program’s Annual Percentage Rate (APR) for the 2021-2022 academic year. For this academic year, we anticipate that this would equate to an Annual Percentage Rate (APR) of 7.20% that the borrower would pay in interest annually for the loan once the 6 month post-graduation grace period ends. This is lower than most private loans and much lower than credit card interest rates.

Please keep in mind that the APR for the Dreamers Graduate Loan Program will be set to mimic the annual percentage rate (APR) of the federal Grad PLUS loan program. APRs will be reset each year as with the federal Grad PLUS loan program, which means that the APR for loans taken out in subsequent years may be different from the 2021-2022 academic year APR for this loan program.