Federal Direct Student Loans.

What is the Federal Direct Student Loan Program (FDSLP)?
In the past, COCC processed Federal Stafford loans through the Federal Family Education Loan program (FFEL), in which students and parents borrow from private lenders and banks.  Beginning in May 2010, all new loans created for students will participate exclusively in the William D. Ford Federal Direct Loan program, in which borrowers obtain loan funds directly from the U.S. Department of Education.  

Volatility in the credit markets and reductions in lender subsidies have caused many lenders to stop offering borrower benefits and reduce their level of customer service.  Several major lenders have made changes to their program that caused a delay in students receiving funds or other inconveniences.  Some have dropped out of the FFEL program altogether, sometimes without notice.  The Federal Direct Loan program is not impacted by changes in the economy.  We believe that this program will offer students and parents a more streamlined, stable, and predictable borrowing experience.  

Federal Direct Subsidized Loans

Federal Subsidized loans are for students that have demonstrated financial need by federal regulations. No interest is charged while students are enrolled in school at 6 credits, during the 6 month grace period and during any deferment periods. Students must be enrolled in at least 6 credits to qualify for disbursement

Federal Direct Unsubsidized Loan

Federal Unsubsidized loans are not based on the student's financial need.  Interest will accrue on this loan once COCC disburses the funds to your student account.  You may have the interest accrue until repayment begins at which time the interest will become capitalized.  Students must be enrolled in at least 6 credits to qualify for disbursement

Maximum Annual Limits for Loans

Year Dependent


1-44 credits at COCC

No more than $3,500 of this
may be in sub loans.

No more than $3,500 of this
may be in sub loans.
45+ credits at COCC
No more than $4,500 of this
may be in sub loans.
No more than $4,500 of this
may be in sub loans.

Maximum Undergraduate Aggregate Limits for Sub and Unsub Loans 


$23,000 $57,500

Do Direct Loans have to be paid back? 

Yes.  After students graduate, leave school or drop below 6 credits during a term, the 6 month grace period will begin.  During this 6 month grace period student will receive repayment information and the due date of the first payment.  At any time during the grace period or after the student become enrolled in 6 or more credits, they could become eligible for a deference.  Students are encouraged to contact the U.S. Department of Education for deferment options

What has to be done once the Direct Loans are accepted

Once students are awarded and accept Federal Direct Loans, they must fulfill certain other conditions before the loan can be processed.  Student must complete a loan entrance counseling session.  Entrance counseling is completed online and is designed to help students better understand obligations as a loan borrower. Entrance counseling will be required of first time Federal Direct Loan borrowers.  All students requesting new loans after May 2010 will be required to electronically sign a Direct Loan Master Promissory Note with the U.S. Department of Education

One final note.
Students must meet all other criteria applicable to the federal aid programs in general, such as enrollment, good standing, citizenship or permanent residency, financial aid transcripts on file, and supply any other relevant documentation requested by the Financial Aid Office.

Got more questions?
If you have more questions about Federal Direct Loans, please contact the Financial Aid Office at coccfinaid@cocc.edu or call 541-383-7260.

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