Federal Direct Loan
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Introduction
Federal Direct Subsidized
Federal Direct Unsubsidized Stafford Loan (FDUSL)
Federal Direct Parent Loan (FDPL)
Additional Information
Columbia College has been approved by the Secretary of Education to participate in the Federal Direct Student Loan Programs (FDSLP) and Federal Direct Parental Loan Program (FDPLP). Columbia does not participate in the Federal Family Educational Loan Program (FFELP).
The FDSLP and FDPLP programs allow students and parents to borrow directly from the Treasury of the United States, rather than from a lender such as a bank or credit union. Additionally, FDSLP and FDPLP loans will not need to be "guaranteed" by an outside guarantee agency, as they are federally guaranteed.
Federal Direct Subsidized Stafford Loans (FDSSL) top
The subsidized Stafford Loan is a need-based loan, that is, it is subtracted from "need" along with other forms of need-based financial aid. Your "need" is calculated to be the cost of attendance minus your expected family contribution (EFC). Your current financial aid file must be complete in order to determine your eligibility for a Stafford loan. Remember, failure to comply with federal regulations will result in denial of financial aid.
Direct Stafford Loan Interest Rates
If you receive a Subsidized Stafford Loan, the federal government will not charge you (will subsidize) interest until six months after you graduate or fall below half-time enrollment. It is your responsibility to pay interest on your loan. The interest rate will be a variable rate for the life of the loan, adjusted once a year on July 1, and will not exceed 8.25 percent.
Federal Direct Unsubsidized Stafford Loan (FDUSL) top
The Federal Direct Unsubsidized Loan is a non-need-based loan that can be awarded in conjunction with the Federal Direct Subsidized Stafford Loan or as a separate award. A student must meet all eligibility requirements.
Students must pay interest while enrolled, unless they capitalize the interest, that is, add the interest to their loan principal instead of paying the interest monthly. The Loan Servicer will provide instructions about this option. If you capitalize your interest, your monthly payment will be greater once you enter repayment.
Unsubsidized Interest Payment
Unlike Subsidized Direct Stafford Loans, you are responsible for paying interest charges on Direct Unsubsidized Stafford Loans while you are in school. The interest may accrue, or it may be capitalized (added to the loan principal), which postpones payment until later. Capitalizing your interest will increase the amount of your principle and increase your monthly payment once you begin to repay your loan. Your servicer will give you additional details and an opportunity to choose which way you want to pay your interest expenses.
Federal Direct Parent Loan/Plus Loan (FDPL) top
- This non-need-based loan makes it possible for the parents of dependent undergraduates to borrow money, regardless of income, for educational expenses. Repayment of these loans must begin no later than 60 days after the funds are disbursed. A PLUS loan is limited to the cost of attendance minus other financial aid received by the student.
- The student on whose behalf an FDPL is requested must meet all current financial aid requirements regarding enrollment, financial aid transcript, academic eligibility and other federal requirements, as well as, have a complete financial aid file.
- Parents seeking such a loan must submit an application and an accurate and complete FDPL promissory note. If a dependent student's parent applies for a Federal Direct Parent Loan and is rejected due to adverse credit the dependent student may apply for an unsubsidized Stafford loan. The amount of the unsubsidized loan cannot exceed federal limits for the academic year.
Additional Information top