The U.S. Department of Education has two federal student loan programs:
The William D. Ford Federal Direct Loan (Direct Loan) Program is the largest federal student loan program. Under this program, the U.S. Department of Education is your lender. There are four types of Direct Loans available:
- Direct Subsidized Loans are loans made to eligible undergraduate students who demonstrate financial need to help cover the costs of higher education at a college or career school. Interest is not charged before repayment or during authorized periods of deferment because the federal government "subsidizes" the interest during these periods. Repayment begins six months after graduation or after a student drops below half-time status.
As of July 1, 2013 first time borrowers may only receive Subsidized Direct Student loans for 150% of the published time of the academic program. Students who continue enrollment on at least a half-time basis in the same program or enroll in another program of the same or shorter length will no longer be eligible to receive additional subsidized student loans. Furthermore, students will lose the interest subsidy on all prior subsidized loans. Borrower responsibility for interest will be triggered from the date of continued or subsequent (at least half-time) enrollment in an eligible undergraduate program of equal or lesser length. All unpaid accrued interest is capitalized in the same manner as unsubsidized loans. Eligibility on lost interest subsidy cannot be regained.
- Direct Unsubsidized Loans are loans made to eligible undergraduate, graduate, and professional students, but in this case, the student does not have to demonstrate financial need to be eligible for the loan. Interest is charged from the time the loan is disbursed until it is paid in full. If a student allows the interest to accumulate while in school or during other periods of nonpayment, it will be capitalized - that is, the interest will be added to the principal amount of the loan.
Annual Subsidized and Unsubsidized Loan Limits
Graduate & Professional Students: $20,500 Unsubsidized (all years)
|Year in School ||Base |
|Additional Unsubsidized for |
(and for dependent students
whose parents are unable
to obtain PLUS loan)
|Freshman ||$3,500 ||$2,000 ||$5,500 ||$4,000 |
|Sophomore ||$4,500 ||$2,000 ||$6,500 ||$4,000 |
|Junior/Senior ||$5,500 ||$2,000 ||$7,500 ||$5,000 |
Aggregate Limits for Sub/Unsub Loans
| ||Subsidized ||Total (Sub and Unsub)
|Dependent Undergraduates ||$23,000 ||$31,000 |
|Independent Undergraduates and |
Dependent Students whose parents can't get PLUS
|$23,000 ||$57,500 |
|Graduate and Professional Students ||$65,500 ||$138,500 |
- The aggregate loan limits include any Subsidized Federal Stafford Loans or Unsubsidized Federal Stafford Loans you may have previously received under the Federal Family Education Loan (FFEL) Program. As a result of legislation that took effect July 1, 2010, no further loans are being made under the FFEL Program.
- Effective for periods of enrollment beginning on or after July 1, 2012, graduate and professional students are no longer eligible to receive Direct Subsidized Loans. The $65,500 subsidized aggregate loan limit for graduate or professional students includes subsidized loans that a graduate or professional student may have received for periods of enrollment that began before July 1, 2012, or for prior undergraduate study.
If the total loan amount you receive over the course of your education reaches the aggregate loan limit, you are not eligible to receive additional loans. However, if you repay some of your loans to bring your outstanding loan debt below the aggregate loan limit, you could then borrow again, up to the amount of your remaining eligibility under the aggregate loan limit.
Graduate and professional students enrolled in certain health profession programs may receive additional Direct Unsubsidized Loan amounts each academic year beyond those shown above. For these students, there is also a higher aggregate limit on Direct Unsubsidized Loans.
- Direct PLUS Loans are loans made to graduate or professional students and parents of dependent undergraduate students to help pay for education expenses not covered by other financial aid.
Parents/students may borrow up to the cost of education minus any other estimated financial aid, assuming they meet established criteria. Students must file a FAFSA in order to determine eligibility for the PLUS loan program.
A dependent student for whom a PLUS Loan is borrowed must meet the general eligibility criteria in 34 CFR 668 Subpart C and a parent borrower must meet the eligibility criteria, such as citizenship, specified in 34 CFR 685.200(c)(1). The current PLUS loan is a fixed rate of 6.31%. Each loan also carries an origination fee of 4.272%. The lender deducts these fees from disbursements sent to the college.
Process a credit pre-approval and E-Sign the Parent MPN online.
Dependent Students: If a parent borrower is unable to secure a PLUS loan, the undergraduate dependent student may be eligible for additional unsubsidized loans to help pay for his or her education, we will automatically process an additional Direct Unsubsidized Loan for you.
- Direct Consolidation Loans allow you to combine all of your eligible federal student loans into a single loan with a single loan servicer.
The Federal Perkins Loan Program is a school-based loan program for undergraduates and graduate students with exceptional financial need. Under this program, the school is lender. Amount received depends on financial need, amount of other aid, availability of funds at school. Repayment begins nine months after student graduates or completes military service. 5% fixed interest rate in repayment.
Click here to complete your MPN and entrance counseling for Federal Student Loans.
Interest Rates and Fees
The interest rate varies depending on the loan type and (for most types of federal student loans) the first disbursement date of the loan. The table below provides interest rates for Direct Loans first disbursed on or after July 1, 2016.
Perkins Loans (regardless of the first disbursement date) have a fixed interest rate of 5%.
|Interest Rates for Direct Loans First Disbursed on or After July 1, 2016 |
|Loan Type ||Borrower Type ||Loans first disbursed on or after 7/1/16 and before 7/1/17 |
|Direct Subsidized Loans ||Undergraduate ||3.76% |
|Direct Unsubsidized Loans ||Undergraduate ||3.76% |
|Direct Unsubsidized Loans ||Graduate or Professional ||5.31% |
|Direct PLUS Loans ||Parents and Graduate or Professional Students ||6.31% |
All interest rates shown in the chart above are fixed rates for the life of the loan.
Note: The interest rates for federal student loans are determined by federal law. If there are future changes to federal law that affect federal student loan interest rates, we will update this page to reflect those changes.
View the interest rates on federal student loans first disbursed before July 1, 2016.
Federal student loans fees
Most federal student loans have loan fees that are a percentage of the total loan amount. The loan fee is deducted proportionately from each loan disbursement you receive. This means the money you receive will be less than the amount you actually borrow. You're responsible for repaying the entire amount you borrowed and not just the amount you received.
The chart below shows the loan fees for Direct Subsidized Loans, Direct Unsubsidized Loans, and Direct PLUS Loans first disbursed on or after Oct. 1, 2014.
|Loan Type ||First Disbursement Date
||Loan Fee |
|Direct Subsidized Loans and Direct Unsubsidized Loans ||On or after 10/1/14 and before 10/1/15 ||1.073% |
|On or after 10/1/15 and before 10/1/16 ||1.068% |
|Direct PLUS Loans ||On or after 10/1/14 and before 10/1/15 ||4.292% |
|On or after 10/1/15 and before 10/1/16 ||4.272% |
Loans first disbursed prior to Oct. 1, 2014, have different loan fees.
There are no loan fees for Perkins Loans.
The Federal Student Aid Ombudsman Group of the U.S. Department of Education is dedicated to helping resolve disputes related to Direct Loans, Federal Family Education Loan (FFEL) Program loans, Guaranteed Student Loans, and Perkins Loans. The Ombudsman Group is a neutral, informal, and confidential resource to help resolve disputes about your federal student loans.
Before contacting the Ombudsman Group, be sure to follow the recommendations to resolve problems with your student loan yourself.
You may contact the Ombudsman Group through one of these methods.
U.S. Department of Education
FSA Ombudsman Group
P.O. BOX 1843
Monticello, KY 42633