Federal Direct Loans are borrowed in the student's name and can be either subsidized or unsubsidized. Principal payment is not required while the student is enrolled at a minimum half-time status. The student is given a six-month grace period after graduation (or leaving school) before repayment begins. Starting July 1, 2010, the interest rate on the Federal Direct Subsidized Loan is fixed at 4.5% and the interest rate on the Federal Direct Unsubsidized Loan is fixed at 6.8%.
A student must demonstrate financial need to qualify for a subsidized Federal Direct Loan. No interest accrues on a subsidized loan while the student is enrolled at a minimum of half-time status.
A student with no demonstrated financial need can borrow an unsubsidized Federal Direct Loan. Interest accrues on an unsubsidized loan. The student has the option of paying the interest or allowing the interest to accrue while still enrolled at a minimum of half-time status. Principal is repaid six months after graduation.
The maximum annual and lifetime amount students can borrow through the Federal Direct Loan program is determined by a student's grade level and/or program of study.
|
Federal Direct Loans for
Dependent Undergraduate Students |
|
Total combined subsidized/unsubsidized funding. |
| Loan Limits: |
Year 1 (0-23 credits) |
$5,500 |
| Year 2 (24-53 credits) |
$6,500 |
| Year 3 (53-126 credits) |
$7,500 |
| Lifetime Limit |
$31,500 | |
|
Federal Direct Loans for Independent Undergraduate
Students Enrolled in Certificate Programs |
|
Total combined subsidized/unsubsidized funding.
Additional amounts are unsubsidized. |
| Loan Limits:
|
Year 1 (0-23 credits) |
$3,500 + $6,000 |
| Year 2 (24-53 credits) |
$4,500 + $6,000 |
| Year 3 (53-126 credits) |
$5,500 + $7,000 |
| Lifetime Limit |
$57,500 | |
|
Federal Direct Loans for Graduate Students |
|
Total combined subsidized/unsubsidized funding.
Additional amounts are unsubsidized. |
| Loan Limits: |
Annual Limit |
$8,500 + $12,000 |
| Lifetime Limit |
$138,500 | |
All students who complete a Free Application for Federal Student Aid (FAFSA) will be reviewed for Federal Loan eligibility. Students who meet the following conditions may qualify for a Federal Direct Loan:
Students will be notified of their loan eligibility on their annual Financial Aid Award Letter. If you are a first-time borrower at RMU, you must complete a Master Promissory Note (MPN) and an Entrance Counseling session before your loan(s) can be applied to your student account. The Financial Aid Office will notify you when it is time to complete these important steps.
Your loan information is reported to the National Student Loan Data System (NSLDS). NSLDS is the U.S. Department of Education's central database for student aid. NSLDS receives data from schools, guaranty agencies, the Direct Loan program, and other Department of ED programs. This data can be viewed by guaranty agencies, lenders, and other authorized users of the data system. In addition, you may access NSLDS to view your Title IV loan and grant history.
While returning students do not need to complete an additional MPN, all students need to file the FAFSA or Renewal FAFSA each academic year to borrow a Federal Direct Loan. Your loan will be created in the amount listed on the Financial Aid Award Letter, unless you indicate that you want to reduce or decline the loan.