Loans
Federal Loans are educational loans and must be repaid once a student is no longer enrolled at least half time. There are four main loan types described below.
- Federal Direct Subsidized & Unsubsidized Loans(William D Ford Direct Student Loans)
Federal Direct Loan Limits
Authorized by Ensuring Continued Access to
Student Loans Act of 2008 (H.R. 5715)
Effective for Federal Direct loans first disbursed on or after July 1, 2008
First-Year Undergraduates (less than 30 credits earned)
Academic Grade Level/Loan Type and Maximum Loan Amount
Base Direct Loan eligibility (subsidized and unsubsidized):
Dependent Student = $3,500
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $3,500
Additional unsubsidized Direct Loan eligibility:
Dependent Student = $2,000
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $6,000
Maximum First-Year Total:
Dependent Student = $5,500
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $9,500
Second-Year Undergraduates (30-59 credits earned)
Academic Grade Level/Loan Type and Maximum Loan Amount
Base Direct Loan eligibility (subsidized and unsubsidized):
Dependent Student = $4,500
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $4,500
Additional unsubsidized Direct Loan eligibility:
Dependent Student = $2,000
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $6,000
Maximum Second-Year Total:
Dependent Student = $6,500
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $10,500
Third-and Subsequent-Years Undergraduates (60 or more credits earned) and Certificate Students
Academic Grade Level/Loan Type and Maximum Loan Amount
Base Direct Loan eligibility (subsidized and unsubsidized):
Dependent Student = $5,500
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $5,500
Additional unsubsidized Direct Loan eligibility:
Dependent Student = $2,000
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $7,000
Maximum Third-and Subsequent-Years and Certificate Student Total:
Dependent Student = $7,500
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $12,500
Graduate and Professional Students
Academic Grade Level/Loan Type and Maximum Loan Amount
Total unsubsidized Direct Loan eligibility:
Dependent Student = N/A
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $20,500
Maximum Graduate and Professional Total:
Dependent Student = N/A
Independent Student or Dependent Student Whose Parent is Ineligible for Federal Direct PLUS = $20,500
Aggregate Loan Limits
Dependent Undergraduate or Certificate Student:
$31,000 (no more than $23,000 of which may be subsidized)
Independent Undergraduate or Certificate Student or Dependent Student Whose Parent Is Ineligible for Federal Direct PLUS:
$57,500 (no more than $23,000 of which may be subsidized)
Graduate/Professional Student:
$138,500 (no more than $65,500 of which may be subsidized)
150% Subsidized Loan Limits
New borrowers on or after July 1, 2013, become ineligible to receive additional Direct Subsidized Loans if the period during which the borrower has received such loans exceeds 150% of the published length of the borrower's educational program. The borrower also becomes responsible for accruing interest during all periods as of the date the borrower exceeds the 150% limit.
- Interest rates for undergraduate borrowers are fixed at 2.75% for loans disbursed between July 1, 2020 and June 20, 2021. For graduate borrowers, the Unsubsidized loan rate is fixed at 4.30% for loans disbursed between July 1, 2020 and June 20, 2021.
- A net origination fee of 1.057% of the gross amount of the loan for loans is charged for loans first disbursed between 10/01/2020 and 09/30/2021. The fee amount is subject to change based on federal funding.
- There are repayment plans designed to meet the needs of almost every borrower.
- No payments of principal are required while enrolled at least half-time (on Subsidized and Unsubsidized Direct Loans), but interest accrues while enrolled for Unsubsidized Direct Loans. Students can choose to pay the interest while they are in school or have the interest added to their principal.
If your class level changes during the year, you may be eligible for an increase in your Federal Direct Loan. If you wish to request an increase in your loan amount, please email or stop by the Financial & Registration Services Office to present the request in writing.
The Federal Student Aid Ombudsman of the Department of Education helps resolve disputes and solve other problems with federal student loans.
You may access your prior Federal Loan (Perkins, Direct, and Stafford) information on the National Student Loan Data System (NSLDS) website. This site contains all of your federal Title IV aid history. You can also view your Federal Loan information, including comparing payment plans, by logging into studentaid.gov under the Manage Loans section. Both sites require your FSA username and password to log in.
- Federal Direct Parent Loan for Undergraduate Students (PLUS)
- The PLUS program allows parents of a dependent student to borrow funds. Eligible parent borrowers must be either biological or adoptive parent, or stepparent if listed on the FAFSA.
- Parents can borrow up to the cost of attendance less financial aid.
- The interest rate is fixed at 5.30% for loans disbursed between July 1, 2020 and June 20, 2021.
- A net origination fee of 4.228% of the gross amount of the loan for loans first disbursed between 10/01/2020 and 09/30/2021. (fee is subject to change based on federal funding).
- Must apply online (Log in using parent FSA ID)
- Must complete a Master Promissory Note
- Must complete the Annual Student Loan Acknowledgement each year parent borrows (Log in with parent FSA ID)
- A credit check is required to borrow from this loan program. The credit check is valid for 180 days, and applications are available starting May 1 for the upcoming academic year. In the event the credit check expires before the loan can be processed the credit will be pulled again and the result may be different from the original based on borrower credit history.
- In the event that the parent credit is denied, the parent borrower will be presented with options which include obtaining an endorser (co-signer), appealing the credit decision, or canceling the PLUS Loan. If the parent chooses to cancel the loan, the student is eligible for an additional unsubsidized loan (up to $4,000 for the year for students with less than 60 cumulative credits or up to $5,000 for the year for students with 60 or more cumulative credits). If the parent chooses to get an endorser or appeal the credit decision, the parent will be directed to complete parent PLUS Loan counseling, which must be completed in order to process the loan after the endorser is obtained or the credit appeal granted.
- Repayment begins 60 days after the second disbursement.
- Parents may choose to defer payments until six months after the date the student ceases to be enrolled at least half-time or may pay accruing interest monthly or quarterly, or allow interest to be capitalized quarterly. To request an in-school deferment (after the first disbursement) you may contact Direct Loan Borrower Services at 800-848-0979.
- There are three repayment options: Standard Repayment, Graduated Repayment, and Extended Repayment Plan.
- Parents are given a choice of repayment plans prior to their first payment.
- Repayment periods range from 10 to 30 years depending on repayment option selected.
- Federal Direct Plus Loan for Graduate Students
- The Direct Grad PLUS Loan is for creditworthy graduate students enrolled at least halftime. Graduate students must apply for the maximum amount of Federal Stafford Loans first.
- The interest rate is fixed at 5.30% for loans disbursed between July 1, 2020 and June 20, 2021.
- A net origination fee of 4.228% of the gross amount of the loan for loans first disbursed between 10/01/2020 and 09/30/2021. (fee is subject to change based on federal funding).
- Must apply online (Log in using FSA ID)
- Must complete a Master Promissory Note
- Must complete the Annual Student Loan Acknowledgement each year student borrows (Log in with your FSA ID)
- A credit check is required to borrow from this loan program. The credit check is valid for 180 days, students cannot apply until May 1 for the upcoming year. In the event the credit check expires before the loan can be processed the credit will be pulled again and the result may be different from the original based on borrower credit history.
- If the borrower is denied credit they have the option of reapplying with a creditworthy endorser. If they choose to do this, the student will be directed to complete Grad PLUS Loan counseling, which must be completed prior to the loan being processed with an endorser.
- Payments are deferred until six months after the student ceases to be enrolled at least halftime. Interest accrues during this time. The student may choose to make interest payments while the loan is deferred.
- There are three repayment options: Standard Repayment, Graduated Repayment, and Extended Repayment Plan. You may contact Direct Loan Borrower Services at (800) 848-0979 for more information on repayment options.
A Note About Direct Loan Servicers
Direct Loans (Subsidized, Unsubsidized, Parent PLUS, and Grad PLUS) are funded by the U.S. Department of Education through Castleton University. Under the supervision of the Department of Education, loan servicers are assigned to manage the loans. For more information about loan servicers go to studentaid.gov to view the loan servicer information for your Direct Loans under the Manage Loan section.