Financial Aid Loans

Unlike grants or work-study, loans are a form of financial aid that you must pay back at interest rates that are typically lower than consumer rates, usually not until after your studies have been completed. The size of the loan you seek and commit to should be determined only after all available gift-aid has been applied for. You should also determine whether the loan you choose has an interest-free grace period before repayment begins and if all or some of the loan may be deferred or repaid after graduation.

Information for Borrowers

William D. Ford Direct Loan
William D. Ford Direct Loan Program

Federal direct loan programs consist of low-interest loans are available to undergraduate students. The loan interest rate is variable (capped at 4.45 percent for both Subsidized and Unsubsidized) and adjusted annually.

Federal Direct Subsidized Loans

Subsidized loan eligibility is based upon demonstrated financial need (filing the FAFSA) and the interest is subsidized (paid) by the federal government until you are enrolled less than half time.

Federal Direct Unsubsidized Loans

Interest accrues while the student is enrolled in school at least half-time, or interest payments can be made on a monthly basis.

We encourage students to submit only one application that estimates the total loan needs for the academic year. Direct loan applications are submitted to the Office of Financial Aid and processed based on the student's federal eligibility.


Origination fees are fees assessed by lenders to help offset the cost of processing the loan. The origination fee is assessed on each loan disbursement.

As of October 1, 2016 – September 30, 2017, an origination fee of 1.069 percent is deducted automatically from amounts borrowed from the Subsidized and Unsubsidized loans.

As of October 1, 2016 – September 30, 2017, an origination fee of 4.276 percent is deducted automatically from amounts borrowed from the Direct Parent PLUS loan.

Federal Direct Parent PLUS Loan

Parents of dependent students are eligible to apply for loans under the Federal Direct Loan program. The parent must be a biological parent, step-parent or adoptive parent whose information is on the FAFSA. These loans are based on credit not need. Parents may borrow up to the student's cost of education minus any other financial aid and scholarships.

Repayment on Parent PLUS loans begins within 60 days after the final disbursement of the loan. However, you may request a deferment through your servicer, if you or your child is enrolled at least half-time. The loan interest rate is variable (capped at 7.00 percent) and adjusted annually.

Master Promissory Note (MPN)

The borrowing parent must sign a master promissory note online at Be sure to complete the "Parent Plus" MPN. If the parent has previously completed an MPN, in most cases a new promissory note is not required. If the parent applies with an endorser to get approval, a new PLUS MPN will be required.

What Happens if the PLUS Application Is Not Approved?

There are several options you may wish to consider:

  • The parent borrower may re-apply with an approved endorser (co-signer), or
  • The student is eligible to receive an additional unsubsidized Stafford loan. The maximum loan amounts are based upon the student's year in college:
    • Freshmen and sophomores can borrow a maximum of $4,000.
    • Juniors and seniors can borrow a maximum of $5,000.
Federal Direct Loan Consolidation

The U.S. Department of Education offers a Federal Direct Loan Consolidation Program. The program allows Federal Direct Loan, as well as Federal Family Education Loan (Stafford, PLUS), borrowers to combine one or more federal loans into one new loan.

  • Federal loan programs may be consolidated under the Federal Direct Consolidation Program.
  • Interest is calculated on the weighted average of the interest rates on the loans being consolidated, rounded to the nearest higher 1/8 of 1 percent (not to exceed 8.25 percent). This rate is not variable and applies for the life of the loan.
  • The program extends repayment period up to 30 years.
  • There is no prepayment penalty.

For further information or to apply, contact the U.S. Department of Education Federal Direct Loan Consolidation Program.  

What Is the Interest Rate?

For current loan interest rates and fees, please read more here.

How Much Can I Borrow?
Annual Loan Limits for Direct Subsidized Loans and Direct Unsubsidized Loans
 Dependent Undergraduate StudentsIndependent Undergraduate Students
First Year (freshman)$5,500 (maximum $3,500 subsidized)$9,500 (maximum $3,500 subsidized)
Second Year (sophomore)$6,500 (maximum $4,500 subsidized)$10,500 (maximum $4,500 subsidized)
Third Year (junior) and Beyond$7,500 (maximum $5,500 subsidized)$12,500 (maximum $5,500 subsidized)

Aggregate Loan Limits: Maximum Total Outstanding Loan Debt
 Dependent Undergraduate StudentsIndependent Undergraduate Students
Undergraduate$31,000 (maximum $23,000 subsidized)$57,500 (maximum $23,000 subsidized)

Federal regulations require that when a student is enrolled in a program that is one academic year or more in length, but is in a remaining period of study that is shorter than a full academic year, the loan must be prorated. Students who graduate in the summer session or fall term will have their loans prorated.

How Do I Know if I Meet the Requirements for a Direct Loan?

In order to qualify for a Direct Loan(s), a student must first have filed a FAFSA application and his or her SAR must be complete for the current academic year.
In addition, the student:

  • must be matriculated,
  • must be registered for at least six credits for the semester(s) of the loan(s),
  • cannot be in default of any loans,
  • cannot be over the aggregate limit (exceed annual award limit), and
  • must meet program pursuit and academic progress guidelines.

You must participate in the  Entrance Interview for the William D. Ford Direct Loan.
You must download the Direct Loan Application (Subsidized and Unsubsidized)