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Federal Direct Subsidized/Unsubsidized Loan

Federal Direct Subsidized/Unsubsidized Loans are low-interest loans for undergraduate and graduate students who complete a FAFSA.

Eligibility

Student must:

  • Must be fully admitted as a degree-seeking student in an undergraduate or graduate program at Indiana State.
  • Must be enrolled at least half-time when the loan is expected to be disbursed.
  • Must maintain SAP standards.
  • Must be a U.S. Citizen or eligible non-citizen.
  • Must not be in default on an educational loan or owe an overpayment on a federal education grant, or other federal debt, or has made satisfactory arrangements to repay that debt.
  • New borrowers after July 1, 2013 must complete their program of study within 150% of the established program length in order to remain eligible for the interest rate subsidy.

How To Apply

Amount

Federal Direct Subsidized  Loans:

  • Collect interest at 0% while the borrower is enrolled at least half-time;
  • Collect interest at a fixed APR when the borrower graduates or drops below half-time enrollment;
  • Require an origination fee assessed at disbursement for loans depending on when the loan originates;
  • Require unmet need as defined by the FAFSA;
  • Are only available for undergraduate students.

Federal Direct Unsubsidized Loans:

  • Collect interest at a fixed APR;
  • Require an origination fee assessed at disbursement for loans depending on when the loan originates;
  • Are available for undergraduate and graduate students.

Current interest rates are published annually at https://studentaid.ed.gov/sa/types/loans/interest-rates.

Grade levels listed below have been in effect since Fall 2014. Because the Federal Direct Loan program does not require a credit check, it requires both annual and cumulative (lifetime) limits as listed below:

Annual_Loan_Limits

RepaymentDisbursement of Funds

  • Loan funds are applied to student accounts approximately ten days before the start of the semester.
  • Half of the amount applied for is disbursed at the start of the fall semester and the other half at the start of the spring semester.
  • Funds will first cover direct educational expenses on the student's account.
  • Any excess funds are refunded to the student via ACH direct deposit or sent to the student's permanent address.
  • Loan amounts will be prorated for undergraduate students graduating in December.
  • Borrowers have the right to cancel all or a portion of the loan with no penalty by submitting a loan reduction form within 14 days of disbursement.

To find out more about repayment options before receiving a Direct Loan, borrowers may contact the Federal Student Aid Information Center at 1-800-4-FED-AID (1-800-433-3243).

In addition, visit repayment.

Contact

220 North Seventh Street
150 Tirey Hall
Indiana State University
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Current Phone Hours

Monday - Friday 9 a.m. - 4:30 p.m.