Subsidized Direct Loan

The Subsidized Direct Loan is a need based loan awarded to undergraduate students.  Students are awarded this loan after being considered for grant aid first. 

Loan Terms

• No interest accumulates on the Subsidized Loan while the student is attending at least half time. 
• If the student drops below half time status, the grace period begins.
• All loans have an origination fee.
• For loans disbursed prior to July 1, 2012, there is no interest during the grace period.  For loans disbursed after July 1, 2012, interest begins accruing during the grace period. 
• Repayment begins after the end of the grace period.

Interest Rates for Undergraduate students

July 1, 2013 - June 30, 2014: 6.8%

July 1, 2012 - June 30, 2013: 3.4%

For prior year interest rate information, visit studentaid.ed.gov.

Loan Fees

Loan fees are deducted from each loan disbursement.  The fee is currently 1% on Subsidized Direct Loans.  This is scheduled to change to 1.051% due to federal budget cuts known as the sequester.

Important Information for Graduate Students

Graduate students are not eligible for Subsidized Direct Loans.  Subsidized loans awarded to graduate students from July 1, 2006 through June 30, 2012 have a fixed interest rate of 6.8%.

Unsubsidized Direct Loan

The Unsubsidized Direct Loan is a non-need based loan awarded to both undergraduate and graduate students.  Students are awarded this loan after being considered for grant aid and need based loans first. 

Loan Terms

• Interest begins accumulating on the Unsubsidized Loan when the funds are disbursed to the student.
• All loans have an origination fee.
• Once a student drops below half time status, the grace period begins. 
• Repayment begins after the end of the grace period.

Interest Rate

Since July 1, 2006, the interest rate on the Unsubsidized Loan has been a fixed rate of 6.8%.

Loan Fees

Loan fees are deducted from each loan disbursement. The fee is currently 1% on Subsidized Direct Loans. This is scheduled to change to 1.051% due to federal budget cuts known as the sequester.

Entrance Loan Counseling & Master Promissory Note

All first time borrowers must complete both Entrance Counseling and the Master Promissory Note (MPN) to receive their loan.  Entrance Counseling is an online tutorial which explains important information regarding borrowing a federal student loan.  The MPN is the agreement to repay the loan.  Both of the items are completed through the Department of Education website: studentloans.ed.gov.  You will need your PIN to log into this site.  If you have forgotten your PIN go to www.pin.ed.gov.

Maximum Loan Limits

Annual Loan Limits

Grade Level	Dependent Student*	Independent Student
Freshman (0-23 credits)	$5,500 (no more than $3,500 Subsidized)	$9,500 (no more than $3,500 Subsidized)
Sophomore  (24-59 credits)	$6,500 (no more than $4,500 Subsidized)	$10,500 (no more than $4,500 Subsidized)
Juniors & Senior (60+ credits)	$7,500 (no more than $5,500 Subsidized)	$12,500 (no more than $5,500 Subsidized)
Graduate Students	N/A	$20,500

 

Aggregate Loan Limits

Dependent Students*	$31,000 (no more than $23,000 Subsidized)
Independent Student	$57,500 (no more than $23,000 Subsidized)
Graduate Students	$138,500 (no more than $65,500 Subsidized**)

*Dependent Students whose parents cannot borrow a PLUS Loan have the same loan limits as Independent Studnets

**As of July 1, 2012, Graduate students are no longer eligible for Subsidized Loans.

Repayment

After the Direct Loan is disbursed to the student, the loan is assigned to one of the Federal Direct Loan Servicers.  The Loan Servicer will send periodic statements to the borrower regarding their loan status.  Once the student drops below half time status or stops attending, there is a six month grace period on the loan.  Students in this status will be required to complete Exit Loan Counseling.  Repayment begins after the grace period ends.  All repayment questions, including questions about deferment, forbearance, loan forgiveness, and consolidation should be directed to the Loan Servicer.  For students who need help contacting their Loan Servicer, visit the National Student Loan Data System (NSLDS) website.