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Federal Direct Loans

Federal Direct Subsidized Loan

Sponsor: U.S. Department of Education, 1-800-557-7394.
Amount: Up to $3,500 Freshman, $4,500 Sophomore, $5,500 Junior and Senior.  (NOTE: Effective July 1, 2012 the Subsidized Loan is no longer available to graduate students.)
Interest: 4.66%.  Based on 10-year Treasury bond yield plus 2.05 percent. Interest rate not to exceed 8.25%.
Repayment
Term:
Standard: 10 years. Many other options are available: see Federal Student Aid.
Fees: An origination fee of 1.073% will be deducted from each disbursement.
Eligibility: Student must maintain at least half-time enrollment status (i.e. at least 6 credits/points or, for graduate students, half-time equivalency as approved by their academic department) in each enrolled semester and meet basic eligibility requirements.
Deferral:

Principal and interest*.  Repayment begins six months after graduation or when the student falls below half-time status.

* For new Subsidized Loans, the interest subsidy during the six-month grace period is eliminated for students who fall below half-time status.

A Federal Direct Subsidized Loan is a low interest need-based loan made to students enrolled at least half-time who have completed the FAFSA for the appropriate academic year. The federal government pays loan interest while the student is in school, and loan repayment begins six months after the student graduates or drops below half-time enrollment. Eligible students are automatically considered also for the Federal Direct Unsubsidized Loan (described below).

Elimination of Loan Interest Subsidy:  Effective July 1, 2012 the Subsidized Loan is no longer available to graduate and professional students for loan periods beginning on or after July 1, 2012.  The graduate loan program becomes entirely unsubsidized, which means that the borrowed amount will accrue interest while the student is in school.  The annual and aggregate borrowing limits are not affected (the maximum amount a student can borrow in the Direct Loan program will remain at $20,500 per academic year), and all students are automatically evaluated for loan eligibility.

Elimination of Grace Period Interest Subsidy:  Effective July 1, 2012, for new Subsidized Loans, the interest subsidy during the six-month grace period is eliminated for students who fall below half-time status.

 

Federal Direct Unsubsidized Loan

Sponsor: U.S. Department of Education, 1-800-557-7394.
Amount: Up to $5,500 Freshman, $6,500 Sophomore, $7,500 Junior/Senior, $20,500 Graduates, $40,500 Graduates in health professions. (All amounts minus any subsidized loan.) Additional unsubsidized amounts available: see below.
Interest: 4.66% for undergraduate students, 6.21% for graduate students.  Based on 10-year Treasury bond yield plus 2.05 percent (for undergraduate students) and 10-year Treasury bond yield plus 3.60 percent (for graduate students). Interest rate not to exceed 8.25% (for undergraduate students) and 9.50% (for graduate students).
Repayment
Term:
Standard: 10 years. Many other options are available: see Federal Student Aid.
Fees: An origination fee of 1.073% will be deducted from each disbursement.
Eligibility: Student must maintain at least half-time enrollment status (i.e. at least 6 credits/points or, for graduate students, half-time equivalency as approved by their academic department) in each enrolled semester and meet basic eligibility requirements.
Deferral: Principal only. Interest may be capitalized. Repayment begins six months after graduation or when the student falls below half-time status.

Eligible students who have completed the FAFSA for the appropriate academic year are automatically evaluated for the Unsubsidized Loan.

If you are a dependent student whose parent was DENIED a Parent PLUS Loan (described below), you may be eligible for additional unsubsidized loan amounts. For Freshman & Sophomores the additional unsubsidized loan is $4,000. For Juniors & Seniors the additional unsubsidized loan is $5,000. Please contact the Office Of Financial Aid so we may suggest these amounts. Documentation of denied PLUS Loan may be required.


Federal Direct PLUS Loan

Sponsor: U.S. Department of Education, 1-800-557-7394.
Amount: Up to the full cost of education, minus other financial aid received.
Interest: 7.21%.  Based on 10-year Treasury bond yield plus 4.60 percent. Interest rate not to exceed 10.50%.
Repayment
Term:
Standard: 10 years. Many other options are available: see Federal Student Aid.
Fees: An origination fee of 4.292% will be deducted from each disbursement.
Eligibility: Student must maintain at least half-time enrollment status (i.e. at least 6 credits/points or, for graduate students, half-time equivalency as approved by their academic department) in each enrolled semester and meet basic eligibility requirements.
Deferral: Principal only. Interest may be capitalized.  To apply for an in-school deferment, Direct Parent PLUS borrowers should call the Direct Loan Student Loan Support Center at 1-800-557-7394.

The Federal Direct PLUS Loan is available to parents of dependent undergraduate students and to qualifying graduate and professional students who have completed the FAFSA for the appropriate academic year.  PLUS Loans help pay for education expenses up to the cost of attendance minus all other financial aid received. Interest is charged during all periods. The U.S. Department of Education will evaluate the borrower's credit history to determine eligibility.

Brownstone


Federal Direct Loan FAQ


Federal Student Loan Aggregate Limit

There are maximum limits on the subsidized and unsubsidized loans you are eligible to receive. The aggregate limit is the lifetime amount you may borrow from the federal student loan program.

How much can I borrow?

NYU will suggest the actual loan amount you are eligible to receive each academic year.  However, there are limits on the maximum amount in subsidized and unsubsidized loans that you are eligible to receive each academic year (annual loan limit) and over your academic career (total loan limits). These limits depend on:

  • What year you are in school and;
  • Whether you are a dependent or independent student.

If you are a dependent student whose parents are ineligible for a Direct PLUS Loan, you may be able to receive additional loan funds.

The following chart provides maximum annual and total loan limits for subsidized and unsubsidized loans as of July 1, 2012.

YearDependent Students
(except students whose parents are unable to obtain PLUS Loans)
Independent Students
(and dependent undergraduate students whose parents are unable to obtain PLUS Loans)
1st year undergrad. $5,500—No more than $3,500 of this amount may be in subsidized loans. $9,500—No more than $3,500 of this amount may be in subsidized loans.
2nd year undergrad. $6,500—No more than $4,500 of this amount may be in subsidized loans. $10,500—No more than $4,500 of this amount may be in subsidized loans.
3rd year and beyond undergrad. $7,500 per year—No more than $5,500 of this amount may be in subsidized loans. $12,500 per year—No more than $5,500 of this amount may be in subsidized loans.
Graduate and Prof-
essional Degree Student
Not Applicable $20,500
Maximum Total Debt from Sub-
sidized and Unsub-sidized Loans
$31,000—No more than $23,000 of this amount may be in subsidized loans.

$57,500 for undergraduates—No more than $23,000 of this amount may be in subsidized loans.

$138,500 for graduate or professional students—No more than $65,500 of this amount may be in subsidized loans. The graduate debt limit includes all federal loans received for undergraduate study.

Note: The maximum total loan limits include any Subsidized Federal Loans or Unsubsidized Federal Loans you may have received under the Federal Family Education Loan (FFEL) Program.

Graduate and professional students enrolled in certain health profession programs may receive additional unsubsidized Direct Loan amounts each academic year beyond those shown above. For these students, there is also an increased aggregate loan limit of $224,000 (no more than $65,500 of which can be subsidized).  The debt limit for Graduate and professional students includes any Direct Loans received for undergraduate study.

Source: www.studentaid.ed.gov/types/loans/subsidized-unsubsidized

A detailed outline of your federal loans are available on the National Student Loan Data System at www.nslds.ed.gov, where you can create an account to view your loan history.


Aggregate Limit FAQ

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