Pay for College

Explore college costs and plan how you'll pay for your degree or certificate.

Explore Your Federal Loan Options

Learn about the types and benefits of federal loans

Compare federal Direct loans

How do I apply for federal loans?

What can I borrow if I am a dependent undergraduate?

What can I borrow if I am an independent undergraduate?

What can I borrow if I am a graduate or professional student?

What can I borrow in PLUS loans?

Are there other charges for Direct loans?

Are there other federal loans?


Can't pay for school out of pocket? After scholarships and grants, consider federal loans. Here's a short guide to the major types and features of federal loans. Remember that to apply for these loans you'll need to complete the Free Application for Federal Student Aid, or FAFSA. See Apply for Aid.

Compare federal Direct loans

Under the Federal Direct Loan Program (FDLP), the Department of Education lends money for college, the school delivers the funds to you, and you repay the amount. Use this table to compare loan types and determine what loans you might qualify for.

Direct loan type

Who qualifies?

Repayment starts

Interest rate*

Interest payment details

Subsidized

Undergraduate
student

Eligibility based on financial need

At the end of
the six-month
grace period
after the student
leaves school or drops below half-time enrollment

4.66%

Fixed (does not change for the life of the loan)

Interest does not accrue while you are enrolled at least half time, during the grace period, and during any deferment periods. You pay the interest during repayment.

Unsubsidized

Undergraduate or graduate student

Eligibility not based on need

At the end of
the six-month
grace period
after the student
leaves school or
drops below half-time
enrollment

4.66% for undergraduate students

6.21% for graduate students

Fixed for life of the loan

Once the loan is disbursed, interest starts accruing. You don't have to make interest payments while in school, but if you don't, the accrued interest gets added to your loan amount when repayment starts.

PLUS

Parent

Credit check required

Immediately after last disbursement

7.21%

Fixed

Parent pays the interest. Interest accrues from date of disbursement.

PLUS

Graduate or professional student

Credit check required

Immediately after last disbursement

7.21%

Fixed

Student pays the interest. Interest accrues from the date of disbursement.

Consolidation

Available to most borrowers based on loan type

Immediately after last disbursement

Based on underlying loans' interest rates

In most cases, you are responsible for paying the interest that accrues on the loan from the time the loan is disbursed until it is paid in full.

* Interest rates For a Federal Direct subsidized and unsubsidized loan made to an undergraduate student for which the first disbursement is made on or after:

July 1, 2013, and before July 1, 2014 is 3.86%
July 1, 2014, and before July 1, 2015 is 4.66%

The interest rate for a Direct unsubsidized loan made to a graduate or professional student for which the first disbursement is made on or after:

July 1, 2013, and before July 1, 2014 is 5.41%
July 1, 2014, and before July 1, 2015 is 6.21%

The interest rate on a federal Direct PLUS loan made on or after:

July 1, 2013, and before July 1, 2014 is 6.41%
July 1, 2014, and before July 1, 2015 is 7.21%

There may be exceptions to these interest rates based on military service. Contact the Direct Loan Servicing Center for more information on these exceptions.

How do I apply for federal loans?

You must complete the Free Application for Federal Student Aid, or FAFSA. The Department of Education will use information provided on the FAFSA to calculate your expected family contribution, or EFC. Your school will subtract your EFC from its cost of attendance to determine the financial aid you qualify for, including any federal student loans.

What can I borrow if I am a dependent undergraduate?*

Your school will offer loan amounts based on your financial need. As a general guide, here are the annual limits by year of study along with a maximum amount.

By Year of Study

Annual Loan Limit (subsidized and unsubsidized)

First year

$5,500 — no more than $3,500 of this amount may be subsidized

Second year

$6,500 — no more than $4,500 of this amount may be subsidized

Third year and beyond

$7,500 — no more than $5,500 of this amount may be subsidized

Maximum amount you can borrow over your undergraduate academic career in subsidized and unsubsidized loans

$31,000 — no more than $23,000 of this amount may be subsidized

*Here's an exception: If your parents are unable to obtain a PLUS loan, you may be able to borrow the same loan amounts as an independent undergraduate. See below.

What can I borrow if I am an independent undergraduate?*

Your school will offer loan amounts based on your financial need. As a general guide, here are the annual limits by year of study along with a maximum amount.

By Year of Study

Annual Loan Limit (subsidized and unsubsidized)

First year

$9,500 — no more than $3,500 of this amount may be subsidized

Second year

$10,500 — no more than $4,500 of this amount may be subsidized

Third year and beyond

$12,500 — no more than $5,500 of this amount may be subsidized

Maximum amount you can borrow over your undergraduate academic career in subsidized and unsubsidized loans

$57,500 — no more than $23,000 of this amount may be subsidized

*Note that a dependent student whose parent is unable to obtain a PLUS loan may borrow the same amounts as an independent undergraduate.

What can I borrow if I am a graduate or professional student?

Up to $20,500 annually in unsubsidized loans only. You can borrow a maximum of $138,500; no more than $65,500 of this amount may be subsidized. For periods of enrollment that begin on or after July 1, 2012, graduate and professional students are only eligible for Direct unsubsidized loans.

What can I borrow in PLUS loans?

Parents of undergraduate students and graduate and professional students with good credit histories can borrow up to the cost of attendance minus any other estimated financial assistance. Graduate and professional students use PLUS loan funds for educational costs not covered by subsidized and unsubsidized loans.

Are there other charges for Direct loans?

In addition to interest, you pay a loan origination fee that is a percentage of the principal amount for each loan that you borrow. The Department of Education deducts the fee before you receive any loan money, so the loan amount you actually receive will be less than the amount that must be repaid. Here are the fee rates.

Loan type

Origination fee

For

Direct subsidized or unsubsidized

1%

Loans first disbursed on or after July 1, 2010

PLUS

4%

All PLUS loans

Are there other federal loans?

The Federal Perkins Loan Program offers a low-interest loan that qualifying students can borrow directly from their schools. Here are some facts about the loan.

  • Only students with high financial need are eligible for the loan.
  • To apply, contact your school. Note that funding is limited.
  • Interest rate is fixed at 5% for the life of the loan.
  • Interest is subsidized, that is, paid by the federal government until you begin repayment, and during deferment.
  • If you are a qualifying undergraduate student, you can borrow up to $5,500 per year, or a maximum of $27,500 over your undergraduate academic career.
  • If you are a qualifying graduate or professional student, you can borrow up to $8,000 per year, or a maximum of $60,000 over your graduate academic career.


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