Federal Student Loans
William D. Ford Direct (Unsubsidized) Student Loan Program: Borrowing is subject to annual and aggregate loan limits. Borrowers begin repaying loans six months after ceasing at least half-time enrollment in postsecondary education, unless borrower qualifies for deferment. Cancellation of loans is available for employment in certain designated fields, under certain conditions. This is a loan from the federal government. While eligibility for the subsidized Direct Loan requires proof of financial need, financial need is not a consideration for the unsubsidized Direct Loan. The student must file a Free Application for Federal Student Aid (FAFSA) annually to determine eligibility for participation in this program, and be enrolled at least half-time. The interest rate is determined on July 1st for the succeeding academic year. Borrowers of a Direct Loan are charged a loan origination fee, which will be subtracted from the loan proceeds at disbursement. Graduate and professional students may borrow up to $20,500 per year, if the student’s cost of attendance allows,
Repayment on the principal amount of the loan does not begin until six months after the student leaves school or drops below half-time status, BUT the student is responsible for the interest from the date of the last disbursement of the loan. The student may pay the interest monthly or quarterly, or may defer interest payments during school or the six-month grace period. Arrangements for payment are made by the student with the Department of Education.
William D. Ford Federal Direct Graduate PLUS Loan: The Federal Direct Grad PLUS Loan is available to graduate students who file a FAFSA. Graduate students may borrow up to the cost of attendance minus other financial assistance received. Graduate students are encouraged to utilize their Federal Direct Stafford Loan eligibility prior to borrowing Federal Direct Grad PLUS Loans. The interest rate is determined annually at the time of disbursement. This rate is fixed for the life of the loan. Repayment of principal and interest begins after the six month grace period. The U.S. Department of Education charges a loan origination fee which will be subtracted from the loan proceeds at disbursement. if you receive a Direct PLUS Loan as a graduate or professional student, you will not be required to make any payments while you’re enrolled in school at least half-time, and for an additional six months after you graduate, leave school, or drop below halt-time enrollment. Depending upon the amount borrowed, parents may have up to 10 years to repay.
See studentaid.gov for more information about these loan programs.