Federal Direct Student Loan

What is a Federal Direct Student loan?

Federal Direct Student loans are one form of student aid from the federal government. Under the Federal Direct Student loan program students borrow money for school from the federal government. The Financial Aid Department encourages students to evaluate loan options carefully, borrow only what is really needed and remember that loans must be repaid.

How much can I borrow?
  • $5,500 is the maximum annual amount a first year student is eligible for, no more than $3,500 of which can be subsidized.
  • $6,500 is the maximum annual amount a second year student is eligible for, no more than $4,500 of which can be subsidized.
  • $7,500 is the maximum annual amount a third or fourth year student is eligible for, no more than $5,500 of which can be subsidized.
  • $20,500 is the maximum annual amount a graduate student is eligible to borrow in the form of a Stafford Loan.
  • Independent students and students whose parent(s) are denied a Federal PLUS Loan qualify for additional unsubsidized loans.
What is the difference between a subsidized and an unsubsidized loan?

For the Federal Direct Subsidized Student Loan, you will not be charged interest until you begin repayment. Repayment begins six months after you cease to be enrolled at least half-time (including leaves of absence). The interest rate for Federal Direct Subsidized Loans for undergraduate students disbursed on or after July 1, 2012 will be 6.8%.

For the Federal Direct Unsubsidized Student Loan, the government will not pay interest while a student is in school as it does for the subsidized loan. Interest accrues and must be paid or capitalized during periods of enrollment in school and/or deferment. The interest rate for Federal Direct Unsubsidized Loans for all students disbursed on or after July 1, 2012 will be 6.8%.

Are there any other federal loans available to graduate students?

The Federal Direct Graduate PLUS Loan is a federal loan available to graduate students. The maximum amount you will be eligible to borrow for the school year will be indicated on your Dowling College’s award letter. Students often elect to limit the amount which they borrow to the difference between annual direct costs and other financial aid which you have received. Direct costs are those paid directly to Dowling College including tuition, fees, and room and board for resident students. Indirect costs consist of all other expenses that relate to attendance at Dowling College. The interest rate on Federal Direct Graduate PLUS Loans is 7.9%.

Are there any federal loans available to parents?

The Federal Direct PLUS Loan (parent loan for undergraduate, dependent students) is a loan from the U.S. Department of Education for parents of undergraduate students who complete a FAFSA and meet general eligibility requirements.  Your parent(s) should evaluate whether or not there is a need to borrow in order to assist in the financing of your education.  The amount your parent will be eligible to borrow for the school year will be indicated on your award letter.  Parents often elect to limit the amount which they borrow to the difference between annual direct costs and other financial aid the student has received.  Direct costs are those paid directly to Dowling College including tuition, fees, and room and board for resident students.  Indirect costs consist of all other expenses that relate to attendance at  Dowling College.  The interest rate on PLUS loans is 7.9%..

What fees, if any, are associated with these loans?

For Student Loans, an origination fee of 1.051% of the total loan will be assessed.For PLUS loans, an origination fee of 4.204% will be assessed.

How do I apply for a Federal Direct Student Loan?

Federal Direct Student Loan Process

Step 1 . First time Direct Loan borrowers only must complete a Federal Student Loan Entrance Counseling Session in accordance with federal regulations.  Visit www.mappingyourfutrue.org  and click on “Complete Entrance Counseling”.

Step 2.   First time Direct Loan borrowers only must complete a Direct Loan Master Promissory Note (MPN) at www.StudentLoans.gov.  Borrowers will need their FAFSA Personal Identification Number (PIN) in order to complete the MPN.  If you do not have a PIN or cannot recall it, you can request your PIN at www.pin.ed.gov.

Reserve your place at our Graduate Student Info session Tuesday November 18th from 5:30PM-7:30PM
Reserve Your Place at our Fall Open House Saturday November 15th 9AM-3PM!