Federal Direct Subsidized and Unsubsidized Loans

These loans are available to students from the federal government through the Department of Education. 

Subsidized loans are interest free while the student is enrolled at least half-time.  Fixed interest rates are set by the federal government and subject to change.  The interest rate for subsidized loans originated on or after July 1, 2012 is 3.4%.  To be eligible for this loan, a student must demonstrate financial need as determined from the FAFSA.                                                                        

Unsubsidized loans accrue interest while the student is in attendance.  Students have the option to make interest only payments on the loan while they are in school or defer all payment until after they graduate or leave school for any reason.  Interest that has accumulated while the student is in school will be capitalized and added onto the principal balance of the loan.  Students who do not qualify for a subsidized loan will usually qualify for an unsubsidized loan.  The fixed interest rate for unsubsidized loans is currently 6.8%.

Annual loan limits are set for each class year by the Department of Education and cannot be changed by the school.  Eligibility requirements are also determined by the Department of Education and all regulatory policies must be strictly adhered to by the college.

Eligibility Requirements                                    

  • Must have a valid FAFSA on file
  • Must be a U.S. citizen or eligible noncitizen
  • Accepted as a regular student working toward a degree or eligible certificate program
  • Attending at least half-time (6 credit hours)
  • Maintain satisfactory progress toward a degree per the policies of the college
  • Cannot be in default on any other federal loans
  • Cannot owe a refund on a federal student grant or loan

Annual and Aggregate Loan Limits

Direct Stafford Loan Limits (Subsidized and Unsubsidized)

Class Level for Loan      Eligibility

Undergraduate students

Graduate students



Independent and Dependent students whose parent is denied a PLUS loan



(0-29 credit hours)


 (no more than $3,500 may be subsidized)


(no more than 3,500 may be subsidized)


(as of July 1, 2012, Subsidized loans are no longer available to Graduate students)


(30-59 credit hours)


 (no more than $4,500 may be subsidized)


 (no more than $4,500 may be subsidized)

3rd- and 4th-year

(60+ credit hours)


 (no more than $5,500 may be subsidized)


 (no more than $5,500 may be subsidized)

Aggregate - total that may be borrowed regardless of degree completion


(no more than $23,000 may be subsidized)


(no more than $23,000 may be subsidized)


(no more than $65,500 may be subsidized; includes loans received for undergraduate study)


Accepting Subsidized and Unsubsidized Loans

Subsidized and Unsubsidized loans are awarded to students in an offered status.  Students should review their financial aid award and decide if they need or want the loans that have been offered to them.  Loans will not be originated and disbursed unless the student has accepted the loan in their Banner Self-service account.  Students can choose to accept their loan in full, reduce the amount of the loan, or decline the loans completely. For assistance in reviewing and accepting your loans in Banner the following links may be very helpful:

Other Requirements

All students borrowing a Federal Direct Subsidized or Unsubsidized loan for the first time must also complete the following requirements online at

Disbursement of Loan Funds

Loans are generally awarded for the full academic year (except when a student will only be in attendance for one semester) with two equal disbursements one in fall semester and one in the spring semester. Disbursement of funds does not begin until after the first week of the semester or when schedule adjustment is over.  Funds are disbursed directly to the college and are applied to a student’s account to cover applicable outstanding charges such as tuition, fees, room and board.  Any loan funds in excess of a student’s charges will be refunded to the student by the Student Accounts Office via direct deposit or paper check.

Revisions and/or Return of Loan Funds

If a student wants to change the amount of a loan that they have accepted, declined or reduced in Banner, they will need to submit a Loan Revision Request Form. If a student wants to return all or a portion of a loan that has already been disbursed, they will need to submit a Return Loan Request Form available from the Student Account Office. All requests for a revision or return of loan funds must be within regulatory guidelines.

Changes to Your Status           

Situations that may decrease the amount of a loan after it has been awarded and/or disbursed include:

  • Withdrawal From Classes- may result in a decrease of your loan and/or a return of loan funds
  • Satisfactory Academic Progress (SAP) a student who does not meet SAP standards may lose eligibility for their loan
  • Repeating Courses-  an illegal repeat of a class may result in a decrease to your loan
  • Other Aid - including scholarships, room and board waivers, VESID, and other resources may result in a decrease of your loan

Situations that may increase the amount of a loan and require the submission of a Loan Revision Request Form include:

Loan Servicer

Once your loan has been originated by our office, the Department of Education will assign your loan to a federal servicer. The servicer assigned to your loan(s) will send you correspondence including disclosure statements that contain loan amounts, interest rates and disbursement dates, repayment information and options regarding loan consolidation.  Always notify your loan servicer with any changes to your personal information such as name, address, or phone number and feel free to contact them with any questions regarding your loan(s).  Contact information for your federal loan servicer can be found by reviewing your loan(s) at


Helpful websites: