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Federal Direct Loans
Federal direct loans supply financial assistance for students enrolled at Title IV-certified schools. These loans are provided by the U.S. Department of Education through the Federal Direct Loan Program (FDLP).
Federal Direct Stafford Loans
Direct Stafford loans are federal loans made for college and university students to supplement personal and family resources, scholarships, grants and work-study. They may be subsidized by the Federal Government or unsubsidized depending on the student's financial need.
Stafford Loan Limits
| Dependent Students | Annual Loan Limits |
|---|---|
| First Year | $5,500 ($3,500 subsidized/$2,000 unsubsidized) |
| Second Year | $6,500 ($4,500 subsidized/$2,000 unsubsidized) |
| Third Year and Beyond | $7,500 ($5,500 subsidized/$2,000 unsubsidized) |
| Independent Students | Annual Loan Limits |
|---|---|
| First Year | $9,500 ($3,500 subsidized/$6,000 unsubsidized) |
| Second Year | $10,500 ($4,500 subsidized/$6,000 unsubsidized) |
| Third Year and Beyond | $12,500 ($5,500 subsidized/$7,000 unsubsidized) |
| Graduate or Professional | $20,500 ($8,500 subsidized/$12,000 unsubsidized) |
| Lifetime Limits | |
|---|---|
| Undergraduate Dependent | $31,000 (Up to $23,000 may be subsidized) |
| Undergraduate Independent | $57,500 |
| Graduate or Professional |
$138,500 (Up to $65,000 may be subsidized)
or $224,000 (for Health Professionals) |
| For loans first disbursed on or after July 1, 2008. | |
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Federal Direct PLUS Loans
Parent Plus Direct Loans are available to parents of students enrolled at an accredited, Title IV-certified academic institution. PLUS loans differ from other federal student loans like the Stafford and Perkins loans in that they can cover a larger amount of the cost of education, have a higher interest rate and the commitment is undertaken by the parent, rather than the student. PLUS loans are also available for graduate and professional students.
The Direct Graduate PLUS Loan is similar to the Parent PLUS Loan because it is an unsubsidized, federally guaranteed loan, up to the cost of education. This loan is taken out in the graduate student's name, on their own signature and credit rating. Federal loan deferment and forbearance options are the same as the Stafford Loan so graduate and professional students can postpone repayment while enrolled at least half-time in a degree or certificate program.
Federal Direct Perkins Loans
A Federal Perkins loan is a low-interest federal student loan for undergraduate and graduate students. In the case of Perkins loans, the college acts as the lender, drawing funds from a small pool of money provided by the federal government. Perkins loans are awarded based on exceptional financial need.
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Federal Direct Loan Consolidation
After graduation, many students have a series of federal student loans (and payments), through the Stafford, PLUS or Perkins programs. Federal Direct Loan Consolidation allows you to combine your federal direct student loans into one single loan and realize a reduced monthly payment (up to 50% less), a longer repayment term and a fixed interest rate.
How do I apply for federal direct student loans?
You may apply for federal direct loans by filling out the Free Application for Federal Student Aid (FAFSA). The information on your FAFSA is sent to the colleges and universities you listed on the application to assess your financial need. Get Started on the FAFSA »
How much does a federal direct loan cost?
Direct subsidized Stafford loans for undergraduates as of July 1, 2010 carry an interest rate of 4.5% APR. Direct unsubsidized Stafford loans carry a 6.8% APR. Direct PLUS Loans carry a 7.9% APR. Note that these interest rates are all fixed and will remain the same during your entire repayment period.
