Federal Direct Loan - Undergraduates
With the William D. Ford Federal Direct Loans, you borrow directly from the federal government to help cover your educational expenses. These loans offer low-interest rates and you do not have to begin paying them back until after you graduate or enroll less than half-time.
Types of Federal Direct Loans
Depending upon your level of financial need, you may be offered one of two types of Federal Direct Loans:
Federal Direct Loan - Subsidized
The federal government pays the interest on your loan while you are enrolled at least half-time. Once the six-month grace period is over, you begin repayment on your loan.
- Who is eligible: Students who demonstrate financial need
- Interest rate: 2012-13: 3.4% fixed; 2013-14 6.8% fixed
- Fees: 1.051% origination fee
Federal Direct Loan - Unsubsidized
You are responsible for paying the interest on your loan; the federal government does not pay the interest as with a subsidized loan. You may begin paying the interest while you are still in school or add the interest to the total amount of your loan, which you will begin repaying after you enroll less than half-time, graduate or withdraw from classes.
- Who is eligible: Students who do not qualify for a Federal Direct Loan - Subsidized
- Interest rate: 2012-13: 6.8% fixed; 2013-14 6.8% fixed
- Fees: 1.051% origination fee
Independent students and any dependent undergraduates whose parents are denied a Federal Direct PLUS Loan are eligible to borrow additional Federal Direct Loan - Unsubsidized up to the federal maximum in addition to their annual Federal Direct Loans (subsidized or unsubsidized).
Applying for a Federal Direct Loan
When you apply for financial aid, you will automatically be considered for this loan. If you have not previously borrowed through the Federal Direct Loan program, you must complete an entrance counseling tutorial online and complete a Master Promissory Note (MPN) online before funds can be disbursed to your student account. If you have completed a MPN at a Direct Lending institution within the last ten years, you do not need to submit another MPN.
Aggregate Limits
Dependent Undergraduates
$31,000 (no more than $23,000 may be subsidized)
Independent Undergraduates
$57,500 (no more than $23,000 may be subsidized)
Loan Limits
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| Dependent Undergraduates | |||
| First Year |
$5,500 (no more than $3,500 may be subsidized) | N/A | |
| Second Year |
$6,500 (no more than $4,500 may be subsidized) | N/A | |
| Third Year & Beyond |
$7,500 (no more than $5,500 may be subsidized) | N/A | |
| Dependent Undergraduates whose parent is not eligible to borrow a Parent PLUS Loan | |||
| First Year |
$5,500 (no more than $3,500 may be subsidized) | $4,000 | |
| Second Year |
$6,500 (no more than $4,500 may be subsidized) | $4,000 | |
| Third Year & Beyond |
$7,500 (no more than $5,500 may be subsidized) | $5,000 | |
| Independent Undergraduates | |||
| First Year |
$5,500 (no more than $3,500 may be subsidized) | $4,000 | |
| Second Year |
$6,500 (no more than $4,500 may be subsidized) | $4,000 | |
| Third Year & Beyond |
$7,500 (no more than $5,500 may be subsidized) | $5,000 | |
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