Federal Direct Subsidized and Unsubsidized Loans
Federal Direct Loans are low-interest loans that are meant to help with the cost of college. There are two types of direct loans available for undergraduate students: subsidized and unsubsidized loans. The financial aid office automatically considers students for a loan through the awarding process.
Who can get Direct Subsidized Loans?
Undergraduate students with financial need can get this loan if they are enrolled at least half-time for the semester and they meet satisfactory academic progress standards. The FAFSA is required.
How much can you borrow?
The amount you can borrow is based on your grade level and your financial need and other aid received.
Who will pay the interest accrued?
The U.S. Department of Education pays the interest accrued on the subsidized loan while you are enrolled at least half-time as a student and six months after graduation.
Who can get Direct Unsubsidized Loans?
Undergraduate and graduate or professional students can get this loan as long as they are enrolled at least half-time for the semester and they meet satisfactory academic progress standards. The FAFSA is required.
How much can you borrow?
The amount you can borrow is based on your grade level, other aid received and your cost of attendance.
Who will pay the interest accrued?
The student is responsible for interest payment during all periods.
Interest Rates and Origination Fees
The interest rates of both the Federal Direct Subsidized and Unsubsidized Loans are fixed, but they may change each year. That means your interest rate will not change for the life of the loan. The U.S. Department of Education is the lender for all direct loans. To provide you with a loan, they charge an origination fee up front.
| Loan Type | Origination Fee* | Interest Rate** | Interest Rate*** |
|---|---|---|---|
| Undergraduate Subsidized Loan | 1.057% | 3.73% | 5.50% |
| Undergraduate Unsubsidized Loan | 1.057% | 3.73% | 5.50% |
| Graduate/Professional Unsubsidized Loan | 1.057% | 5.28% | 7.05% |
| Direct PLUS Loan | 4.228% | 6.28% | 8.05% |
*Effective for loans disbursed on or after October 1, 2020 and before October 1, 2024
**Effective for loans disbursed on or after July 1, 2022 and before July 1, 2023
***Effective for loans disbursed on or after July 1, 2022 and before July 1, 2024
Annual and Total Aggregate Loan Limits
Direct subsidized and unsubsidized loans have yearly, and total loan limits. In financial aid terms, this is known as annual and aggregate limits. Annual limits are determined by grade level. Aggregate limits are determined by student type and dependency status.
| Grade Level | Dependent Student | Independent Student (and dependent students whose parents were denied a PLUS Loan) |
|---|---|---|
| Freshman (0-29 credit hours) | $5,500 (no more than $3,500 subsidized) | $9,500 (no more than $3,500 subsidized) |
| Sophomore (30-59 credit hours) | $6,500 (no more than $4,500 subsidized) | $10,500 (no more than $4,500 subsidized) |
| Junior/Senior (60+ credit hours) | $7,500 (no more than $5,500 subsidized) | $12,500 (no more than $5,500 subsidized) |
| Graduate/Professional | N/A | $20,500 (all unsubsidized) |
| Student Type | Aggregate Limit | Note |
|---|---|---|
| Dependent undergraduate | $31,000 | Only $23,000 can be subsidized. |
| Independent undergraduate | $57,500 | Only $23,000 can be subsidized. |
| Graduate/Professional | $138,500 | |
| Certain health professions programs | $224,000 |
Proration
Loan proration impacts undergraduate students applying for fall graduation. When you complete your degree in the middle of an academic year, the financial aid office must adjust your loan based on your enrollment for your final semester. Please note that the actual loan amount may be less if you reached your annual or aggregate loan limits prior to fall semester. See the loan limits above.
Return of Loan Funds
Effective Spring 2024, students who wish to return loan funds that have been disbursed or refunded must do so within 30 days of the date of disbursement. Please complete the Return Loan Funds Form Student (Online) to request a return. Parent borrowers must request a return using Return Parent PLUS Loan Funds Form (Online)