Financial Aid Services Center

Federal Direct Loan Program

Loan eligibility and amounts are based on class level, dependency status, Expected Family Contribution (EFC) as determined by the FAFSA, and require at least half time attendance. Loans are borrowed money and must be repaid with interest. The Direct Subsidized and Unsubsidized Loans have an origination fee and a six-month grace period that begins when a student leaves school or drops below half time. Repayment begins at the end of the six month grace period.

Loan Processing requirements: First time Direct Loan borrowers need to learn about their rights and responsibilities as borrowers, and must complete the Entrance Counseling process. Borrowers must also complete the Master Promissory Note (MPN). A signed MPN and entrance counseling are required prior to funds disbursement.

A Department of Education FSA ID is required to fully access both of these sites and for completing the FAFSA. FSA IDs can be requested online and are good for life. In most cases, you will only need to complete an MPN once during your academic career.

Subsidized Direct Loan: This is a need based loan for undergraduate students with a fixed interest rate of 4.45% adjusted annually. The federal government pays the interest while the student is enrolled at least half-time.

150% Rule: Subsidized Direct Loan borrowers who borrow for the first time on or after July 1,2013 lose the loan subsidy after they have attended beyond 150% of the published length of their academic program. Any subsequent Direct Loans will be in the form of the Unsubsidized Direct Loan up to students' aggregate Direct Loan limits.

Unsubsidized Direct Loan: Interest accrues with the first disbursement. Students will be billed for the accrued interest while in school and during the six-month grace period. The interest rate is 4.45% for undergraduate students, and 6% for graduate students. Only the principal amount of the loan is deferred until after the grace period. If the student chooses not to pay the accrued interest while in school, it will be added to the principal of the loan at the time of repayment. The Unsubsidized Direct Loan is not based on financial need.

Direct PLUS (Parent and Graduate Students): This loan has a fixed interest rate of 7%, and a 4.264% loan origination fee (10/1/2017), and is awarded to the parents of dependent students and to graduate students regardless of need. Borrowers must complete a PLUS Application, pass a credit check, and complete the Master Promissory Note (MPN). Graduate students must complete the entrance counseling process. Plus loans go into repayment 60 days after the last disbursement, but can be deferred with continuous enrollment.

Federal Direct Loans

Annual Federal Direct Loan Maximum Limits

(Includes fall, winter, spring, and summer quarters)

Annual Federal Direct Loan Maximum Limits
Dependent Students (credits)       Independent Students** (credits)   
Freshman (0-44) $5,500 Freshman (0-44) $9,500
Sophomore (45-89) $6,500 Sophomore (45-89) $10,500
Junior (90-134) $7,500 Junior (90-134) $12,500
Senior (135 or more) $7,500 Senior (135 or more) $12,500
Postbaccalaureate* $2625 - $7,500 Postbaccalaureate* $10,500 - $12,500
    Graduate $20,500
* TESOL, preparatory course work, certain certificates, and other programs have reduced limits.
** A student is considered independent for financial aid purposes if he/she can answer "yes" to at least one of the Dependency questions included on the FAFSA.

In addition to annual Direct Loan limits, there are also aggregate limits to loan amounts. For undergraduates and postbaccalaureates, dependent students are limited to $31,000 and independent students are limited to $57,500. Graduate students are limited to a total of $138,500.