Federal Direct Loan Programs
Direct Loans are low-interest loans for students and parents to help pay for the cost of a student’s education after high school. The lender is the U.S. Department of Education rather than a bank or other financial institution. These loans will be discussed in the financial aid appointment. For additional information prior to your appointment, including details on the amount you may be able to borrow, please go to www.studentaid.ed .gov.
Subsidized Federal Direct Loan
This is a student loan, and it must be repaid. The federal government pays the interest on this loan while you are attending school. Your first payment on this loan will be due 6 months after you graduate or your last date of attendance. The maximum amount a student can borrow varies. Your first payment on this loan will not be due until six months after you graduate or your last date of attendance. The first step in applying for the Subsidized Loan is completion of the FAFSA.
Unsubsidized Federal Direct Loan
This is a student loan available to independent students, dependent students whose total family income makes them ineligible for a Subsidized Direct Loan, and dependent students whose parents have applied for and been denied for the Federal Direct PLUS Loan. This loan must be repaid. The student is responsible for the interest that accrues on this loan while the student is attending college. Interest begins to accrue on this loan after the first disbursement has been received.If you choose to defer the interest while you are attending college, the accrued interest will be capitalized and added to the principle balance of the loan quarterly. The maximum amount a student can borrow varies.
Federal Direct PLUS Loan
The Federal Direct Parent Loan for Undergraduate Students (PLUS) lets parents borrow money to cover any costs not already covered by the student’s financial aid package, up to the full cost of attendance. To determine eligibility, a FAFSA must be filed and the parent’s credit must be evaluated. This loan must be repaid. The parent is responsible for the interest that accrues on this loan while the student is attending college. Interest begins to accrue on this loan after the first disbursement has been received. Repayment begins 60 days after the loan is fully disbursed. Under certain circumstances, repayment can be deferred while the student is in school.