Loss of Direct Subsidized Loan Eligibility for Graduate Students under the Budget Control Act of 2011 (Pub. L. 112-25)
Effective for loans made for periods of enrollment (loan periods) beginning on or after July 1, 2012, graduate students will no longer be eligible to receive Direct Subsidized Loans.
Direct Subsidized Loans that have loan periods beginning before July 1, 2012 are not affected by this change. The beginning date of the loan period determines whether a graduate student can receive a subsidized loan. Example: A graduate student could receive a Direct Subsidized Loan for a loan period that begins in June 2012, even if the first disbursement of the loan is made on or after July 1, 2012.
Annual loan limits remain unchanged:
|
Prior to change $ 8,500 Subsidized Loan $12,500 Unsubsidized Loan $20,500 Annual Total |
After change (loan periods beginning July 1, 2012, or later) $ -0- Subsidized Loan $20,500 Unsubsidized Loan $20,500 Annual Total |
Be aware that this change increases the interest expense that many graduate students incur. Consider carefully the amount of loan you accept and the associated repayment requirements. While students may defer interest payments on unsubsidized loans until they graduate and enter repayment, the accumulated interest amplifies the amount of debt and overall loan repayment amount.
WWU Financial Aid Department 2013