Loan Programs

Educational loans can come from the federal government or from private sources such as a bank or financial institution. A federal loan, made through the William D. Ford Federal Direct Loan Program, allows eligible students and parents to borrow directly from the U.S. Department of Education. These loans typically offer borrowers lower interest rates and have more flexible repayment options than loans from banks or other private sources.

Loan Information

General Loan Information
Federal Student Loan Options
Private Student Loans

General Loan Information

To be eligible for any Federal Direct Loan, a student must:

• Submit a valid Free Application for Federal Student Aid (FAFSA)
• Be a U.S. citizen or eligible noncitizen
• Be registered with Selective Service, if you’re a male
• Be matriculated in a degree program
• Be enrolled in at least 6 credit hours (part time)
• Maintain Satisfactory Academic Progress (SAP)

Choose federal first! Federal loans offer the following:

• Fixed interest rates
• Deferment, forbearance and grace-period options
• Multiple repayment plans
• Loan forgiveness
• Backing by the U.S. Federal Government
  
  

Loan Rates 2020-2021

Loan Type	Borrower Type	Interest Rate	Origination Fee (as of 10/1/19 & subject to change for 2021)
Direct Sub & Unsubsidized Loans	Undergraduate	2.75%	1.059%
Direct Unsubsidized Loans	Graduate	4.30%	1.059%
Direct Parent & Grad PLUS Loans	Parent/Graduate	5.30%	4.236%

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Federal Student Loan Options

• Federal Direct Subsidized Loan: A loan based on financial need. The government typically pays the interest that accrues while in school.
• Federal Direct Unsubsidized Loan: This is similar to the Subsidized Loan, but without the financial need requirement. Many students receive both. While the U.S. Department of Education pays the interest on a Subsidized Loan while you're in school, interest on the Direct Unsubsidized Loan will begin accruing from the date of disbursement and continues throughout the life of the loan.
• Federal Perkins Loan: This is a long-term loan with a 5 percent interest rate and a repayment period of 10 years. Repayment must begin within nine months of graduation.
  
  

Yearly Loan Limits

Borrower's Academic Level	Dependent Student (Sub + Unsub = Yearly Limit)	Independent Student (Sub + Unsub = Yearly Limit)
1st Year Undergraduate Student	$3,500 + $2,000 = $5,500	$3,500 + $6,000 = $9,500
2nd Year Undergraduate Student	$4,500 + $2,000 = $6,500	$4,500 + $6,000 = $10,500
3rd Year Undergraduate Student (Bachelor's program only)	$5,500 + $2,000 = $7,500	$5,500 + $7,000 = $12,500
4th Year Undergraduate Student (Bachelor's program only)	$5,500 + $2,000 = $7,500	$5,500 + $7,000 = $12,500
Graduate/Professional Student	Graduate students are considered independent	$20,500 (unsubsidized only)

Aggregate Loan Limits

Borrower's Program Level	Subsidized + Unsubsidized = Aggregate Limit
Dependent Undergraduate	$23,000 + $8,000 = $31,000
Independent Undergraduate	$23,000 + $34,500 = $57,500
Graduate/Professional	$138,500 (unsubsidized only)

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Federal PLUS Loans

This is a federal loan based on credit history, to help parents or graduate students with the cost of attendance.

To qualify for a Direct PLUS loan, the borrower must be:

• The biological or adoptive parent of the student or
• The spouse of the parent and your income and assets were reported on the FAFSA or
• A graduate or professional student

This type of loan requires a credit check during the application process. If you have adverse credit history, you may still receive a Direct PLUS Loan through one of these two options:

1. Obtain a credit-worthy endorser.
2. Submit supporting documents if you have an extenuating circumstance relating to your credit history to the U.S. Department of Education.

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Private Student Loans

Unlike federal student loans, private loans are made by a bank and the terms of the loan are determined by the lending institution. Private loans are typically based on credit history and students typically are required to have a credit-worthy co-signer.

Things to consider!

• Federal loans offer benefits such as fixed interest rates and several repayment plans that are not typically offered by private lending institutions.
• Also, private loans can end up costing you more than a federal student loan.
• Research and compare several banks before borrowing to find the best option for you.

You can find and complete the Private Loan Self-Certification Form found on our forms page. This certification form should be submitted to the Student Financial Services Office.

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