Federal Direct Student Loans.

 

Federal Direct Subsidized Loans

The subsidized loan program provides fixed interest, long-term federal loans through lending institutions in cooperation with a guarantee agency and Financial Aid. Maximum limits are based on financial need, but cannot exceed $3,500 for freshmen and students in certificate programs and $4,500 for sophomores for an academic year. Loans are interest-free until repayment begins, which begins six months after a student ceases to be enrolled at least half time. The interest rate for 2017-2018 loans are fixed at 4.45%. Monthly payment amount and length of repayment depend on the cumulative amount of loans, with a 10-year repayment time limit.

Federal Direct Unsubsidized Loan

The unsubsidized loan program provides fixed interest, long-term federal loans through lending institutions in cooperation with a guarantee agency and Financial Aid. The unsubsidized loan is available to students who do not qualify for need-based subsidized loans or who are not eligible for the full subsidized loan amount, but cannot exceed $5,500 for freshmen and students in certificate programs and $6,500 for sophomores for an academic year. Independent students, as defined by the Department of Education, are eligible to borrow up to an additional $6,000 unsubsidized loan. Student borrowers will be responsible for payment of the interest that accrues on these loans while they are in school and during periods of deferment. The interest rate for 2017-2018 loans are fixed at 4.45%. Loan repayment begins six months after a student ceases to be enrolled at least half time. Monthly payment amount and length of repayment depend on the cumulative amount of loans, with a 10-year repayment time limit. 

  Dependent

Independent

Maximum Annual Loan Limit for Freshman
1-44 credits at COCC

$5,500
No more than $3,500 of this
may be in sub loans.

$9,500
No more than $3,500 of this
may be in sub loans.
Maximum Annual Loan Limit for Sophomore
45+ credits at COCC
$6,500
No more than $4,500 of this
may be in sub loans.
$10,500
No more than $4,500 of this
may be in sub loans.
Maximum Undergraduate Aggregate Loan Limit $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. The promissory note contains detailed information about the terms, responsibilities and repayment of the loan.

 

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 or call 541-383-7260.