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.
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 Counseling for the William D. Ford Direct Loan.
You must download the Direct Loan Application (Subsidized and Unsubsidized)
Information for Borrowers
- Student Loan Default and Repayment Information
- Student Loan Deferment and Cancellation Summaries
- CUNY Model Code of Conduct
- Student Loan Ombudsman
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 fixed (interest rate for the 2022 - 2023 is capped at 4.99% for both Subsidized and Unsubsidized) and adjusted annually. The Parent PLUS loan interest rate for the 2022 - 2023 is capped at 7.54% 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.
|Year||Dependent Students (except students whose parents are unable to obtain PLUS Loans)||Independent Students (and dependent undergraduate students whose parents are unable to obtain PLUS Loans)|
|First-Year Undergraduate Annual Loan Limit||$5,500—No more than $3,500 of this amount may be in subsidized loans.||$9,500—No more than $3,500 of this amount may be in subsidized loans.|
|Second-Year Undergraduate Annual Loan Limit||$6,500—No more than $4,500 of this amount may be in subsidized loans.||$10,500—No more than $4,500 of this amount may be in subsidized loans.|
|Third-Year and Beyond Undergraduate Annual Loan Limit||$7,500—No more than $5,500 of this amount may be in subsidized loans.||$12,500—No more than $5,500 of this amount may be in subsidized loans.|
|Graduate or Professional Students Annual Loan Limit||Not Applicable (all graduate and professional students are considered independent)||$20,500 (unsubsidized only)|
|Subsidized and Unsubsidized Aggregate Loan Limit||$31,000—No more than $23,000 of this amount may be in subsidized loans.||$57,500 for undergraduates—No more than $23,000 of this amount may be in subsidized loans.
$138,500 for graduate or professional students—No more than $65,500 of this amount may be in subsidized loans. The graduate aggregate limit includes all federal loans received for undergraduate study.
Origination fees are fees assessed by federal government to help offset the cost of processing the loan. The origination fee is assessed on each loan disbursement.
As of October 1, 2022 – October 1, 2023, an origination fee of 1.057% is deducted automatically from amounts borrowed from the Subsidized and Unsubsidized loans.
As of October 1, 2022 – October 1, 2023, an origination fee of 4.228% is deducted automatically from amounts borrowed from the Direct PLUS loans
The following chart shows the annual and aggregate limits for subsidized and unsubsidized loans.
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 6.284 %) and adjusted annually.
Master Promissory Note (MPN)
The borrowing parent must sign a master promissory note online at www.studentaid.gov. 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.