Federal Student Loans
Federal Direct Loans
Direct Subsidized Loans
Eligible students may borrow up to the following…
Dependent Students (except students whose parents are unable to obtain PLUS Loans)
Independent Students (and dependent undergraduate students whose parents are unable to obtain PLUS Loans)
First-Year Undergraduate Annual Loan Limit
$5,500-No more than $3,500 of this amount may be in subsidized loans.
$9,500-No more than $3,500 of this amount may be in subsidized loans.
Second-Year Undergraduate Annual Loan Limit
$6,500-No more than $4,500 of this amount may be in subsidized loans.
$10,500-No more than $4,500 of this amount may be in subsidized loans.
Third Year and Beyond Undergraduate Annual Loan Limit
$7,500 per year-No more than $5,500 of this amount may be in subsidized loans.
$12,500-No more than $5,500 of this amount may be in subsidized loans.
Graduate or Professional Student Annual Loan Limit
Not Applicable (all graduate and professional degree students are considered independent).
$20,500 (unsubsidized only).
Subsidized and Unsubsidized Aggregate Loan Limit
$31,000-No more than $23,000 of this amount may be in subsidized loans.
$57,500 for undergraduates-No more than $23,000 of this amount may be in subsidized loans.
$138,500 for graduate or professional students-No more than $65,500 of this amount may be in subsidized loans. The graduate aggregate limit includes all federal loans received for undergraduate study.
Direct Unsubsidized Loans
The term “Unsubsidized” means that interest is not paid for the student. The student may make monthly or quarterly interest payments to the lender or allow the accrued interest to capitalize. The terms of an Unsubsidized Loan are the same as those for a Subsidized Loan with the following exception: The Government does not pay interest on the student’s behalf on a Federal Unsubsidized Loan. All interest that accrues on the loan during enrollment and the grace period is required to be paid by the student. The student may make monthly or quarterly interest payments to the lender or allow the accrued interest to capitalize.
Resources for Direct Loans
Rate changes from year to year apply to subsidized loans first disbursed on or after July 1 of each year through June 30 of the next year. For more information on prior and current interest rates visit: http://studentaid.gov/understand-aid/types/loans/interest-rates.
Direct loans have a loan fee assessed that the borrower is responsible to repay. For more information on prior and current loan fees visit: http://studentaid.gov/understand-aid/types/loans/interest-rates.
The Federal Subsidized Loan is deferred while the student is enrolled in Institution and for a period of six months beyond the student’s last date of attendance. The Federal government pays the interest on Federal Subsidized Loans if the student remains in college on at least a half-time status. Deferments after the student drops below half-time status are not automatic, and the student must contact the lender concerning his/her loan. Applications can be obtained from the Institution’s Financial Aid Office or from the lender. For additional deferment information, contact the Financial Aid Office.
For students and parents of students who participate in the Federal Loan programs, loan information will be reported to the National Student Loan Data System (NSLDS), and will be accessible by guaranty agencies, lenders, and institutions determined to be authorized users of the data system. Loan information can be viewed online at NSLDS – Student Access website https://nsldsfap.ed.gov/login (NOTE: PIN is required for access).
New Interest Rate Cap for Military Members
Interest rate on a borrower’s loan may be changed to 6 percent during the borrower’s active duty military service. This applies to both FFEL and Direct loans. Additionally, this law applies to borrowers in military service as of August 14, 2008. Borrower must contact the creditor (loan holder) in writing to request the interest rate adjustment and provide a copy of the borrower’s military orders.
Federal PLUS Loans
The Federal PLUS loan is available to parents of dependent students to help pay for the educational expenses of the student.
Parents of dependent students include the biological or adoptive parent(s). The PLUS loan is also available to stepparents if their income and assets are taken into consideration when calculating the student’s EFC. PLUS loans are not based on need; however, when combined with other resources, the loan cannot exceed the student’s cost of education. Parents may borrow up to the cost of attendance minus other aid per eligible dependent student. The interest rate is variable and is set on July 1 of each year. A loan fee will be deducted proportionately each time a loan disbursement is made.
For more information on loan fees visit: http://studentaid.gov/understand-aid/types/loans/interest-rates. Re-payment begins within 60 days of the final disbursement unless the parent qualifies for and is granted a deferment by the lender. There is no grace period on these loans. Interest begins to accumulate at the time the first disbursement is made, and parents will begin repaying both the principal and interest while the student is in school. Although the minimum payment amount is $50 per month with at least five years but no more than ten years of re-payment, the actual payment and schedule is determined by the amount borrowed. Applications can be obtained from the Institution’s Financial Aid Office or from the lender. For deferment information, contact the Financial Aid Office.
Browse Other Financial Aid Options
Paying for School? 4 Tips for Borrowing Smarter.
Our guide to navigating the financial assistance options available to you and the best ways manage them while you’re in school.