Federal Direct Student Loans

Direct Loans are low-interest loans for eligible students to help cover the cost of attendance. Eligible students borrow directly from the U.S. Department of Education and are assigned to a loan servicer (link)

Undergraduate students must be enrolled for at least 6 credits (half-time) and Graduate students must be enrolled for at least 5 credits to be eligible for Direct Student Loans.

Important:

2018 -19 Undergraduate Subsidized and Unsubsidized Direct Loans Interest Rate: 5.05%

2018-19 Graduate Unsubsidized Direct Loans Interest Rate: 6.60%

 

How to Apply

  1. File a Free Application for Federal Student Aid (FAFSA) online at www.fafsa.ed.gov 
  2. Accept all or a portion of the award on myHeliotrope (link)
  3. If you accept a Student Direct Loan, you must complete the following steps:

Direct Subsidized Stafford Loan

Subsidized information on studentaid.ed.gov

  • Available to undergraduate students only who are enrolled in at least 6 credits (half-time).
  • Must have financial need  

(Definition of financial need: The difference between the cost of attendance (COA) at a school and your Expected Family Contribution (EFC). While COA varies from school to school, your EFC does not change based on the school you attend).

  • Interest does not accrue while in school at least half-time (6 credits or more) and/or during a period of deferment

 (Definition of deferment: A temporary postponement of payment on a loan that is allowed under certain conditions and during which interest generally does not accrue on Direct Subsidized Loans, the subsidized portion of Direct Consolidation Loans, Subsidized Federal Stafford Loans, the subsidized portion of FFEL Consolidation Loans, and Federal Perkins Loans. All other federal student loans that are deferred will continue to accrue interest. Any unpaid interest that accrued during the deferment period may be added to the principal balance (capitalized) of the loan(s).

Direct Unsubsidized Stafford Loan

 Unsubsidized information on studentaid.ed.gov

  • Available to undergraduate and graduate students.
  • Interest accrues (accumulates) on an unsubsidized loan from the time it’s first paid out.
  • Interest payments are recommended while you are in school, during a period of grace, deferment/forbearance.

(Definition of forbearance: A period during which your monthly loan payments are temporarily suspended or reduced. Your lender may grant you a forbearance if you are willing but unable to make loan payments due to certain types of financial hardships. During forbearance, principal payments are postponed but interest continues to accrue. Unpaid interest that accrues during the forbearance will be added to the principal balance (capitalized) of your loan(s), increasing the total amount you owe.)

How much can I borrow?

 

Dependent Undergraduate Students

 1) Freshman (0-29 credits)
  • $3,500 Annual Maximum Subsidized (if eligible)
  • $5,500 Annual Maximum Subsidized and/or Unsubsidized
    • Example: $3,500 Subsidized and $2,000 Unsubsidized would total to $5,500
2) Sophomore (31-59 credits)
  • $4,500 Annual Maximum Subsidized (if eligible)
  • $6,500 Annual Maximum Subsidized and/or Unsubsidized
    • Example: $4,500 Subsidized and $2,000 Unsubsidized would total to $6,500
3) Junior (60-89 credits)
  • $5,500 Annual Maximum Subsidized (if eligible)
  • $7,500 Annual Maximum Subsidized and/or Unsubsidized
    • Example: $1,000 Subsidized and $6,500 Unsubsidized would total to $7,500
4) Senior (90+ credits)
  • $5,500 Annual Maximum Subsidized (if eligible)
  • $7,500 Annual Maximum Subsidized and/or Unsubsidized
    • Example: $0 Subsidized and $7,500 Unsubsidized

 

Independent Undergraduate Students and Dependent Undergraduate Students whose parents are denied the Federal Parent PLUS Loan

 
 1) Freshman (0-29 credits)
  • $3,500 Annual Maximum Subsidized (if eligible)
  • $9,500 Annual Maximum Subsidized and/or Unsubsidized
    • Example: $3,500 Subsidized and $9,500 Unsubsidized would total to $9,500
2) Sophomore (31-59 credits)
  • $4,500 Annual Maximum Subsidized (if eligible)
  • $10,500 Annual Maximum Subsidized and/or Unsubsidized
    • Example: $2,500 Subsidized and $8,000 Unsubsidized would total to $10,500
3) Junior (60-89 credits)
  • $5,500 Annual Maximum Subsidized (if eligible)
  • $12,500 Annual Maximum Subsidized and/or Unsubsidized
    • Example: $5,500 Subsidized and $7,000 Unsubsidized would total to $12,500
4) Senior (90+ credits)
  • $5,500 Annual Maximum Subsidized (if eligible)
  • $12,500 Annual Maximum Subsidized and/or Unsubsidized
    • Example: $0 Subsidized and $12,500 Unsubsidized

Graduate Students

 Annual maximum - Unsubsidized Loan only: $20,500 (for loans disbursed after July 1, 2012)

Additional loan money for Graduate students could be applied for through a Graduate PLUS Loan (see below)

Aggregate Federal Subsidized & Unsubsidized Stafford Loan Limits

 Dependent, Undergraduate Students
  • $23,000 Aggregate Maximum Subsidized

  • $31,000 Annual Maximum Subsidized and/or Unsubsidized

    • Example: $23,000 Subsidized and $8,000 Unsubsidized would total to $31,000

Independent, Undergraduate Students & Dependent Undergraduate Students whose parents are denied the Federal PLUS Loan
  • $23,000 Annual Maximum Subsidized

  • $57,500 Annual Maximum Subsidized and/or Unsubsidized

    • Example: $23,000 Subsidized and $34,500 Unsubsidized would total to $57,500

Graduate Students
  • $65,500 Annual Maximum Subsidized

  • $138,500 Annual Maximum Subsidized and/or Unsubsidized

    • Example: $65,500 Subsidized and $73,000 Unsubsidized would total to $138,500

Helpful guide on how to accept your student loans on myHeliotrope

 

Federal Direct Parent PLUS Loan

PLUS loan is meant to assist families in covering costs beyond any student financial aid. PLUS Loans are borrowed through the Department of Education and assigned to a loan servicer.

2018-19 Direct PLUS Loan for Parents and Graduate Students Interest Rate: 7.60%

How to Apply

  1. File a Free Application for Federal Student Aid (FAFSA)
  2. The parent must log-in and apply on StudentLoans.gov or complete a Direct PLUS Loan Application with Purchase College’s financial aid office.
  • Remember that the PARENT is the borrower and STUDENT is the student.
  • When logging into StudentLoans.gov, the parent must “Apply for a Direct PLUS Loan.” A credit decision is immediate.
  • If approved, complete the Master Promissory Note (MPN) on the same site.
  • If denied, three options are available:
    • Request a credit appeal.
    • Provide an endorser.
    • Not pursue the PLUS Loan: The student may use additional Direct Unsubsidized Loan. Additional Unsubsidized Stafford loan funding is available up to $4,000/academic year for 1st and 2nd year students (59 or less credit hours earned); and up to $5,000/academic year for 3rd and 4th year students (60 or more credit hours earned).

Federal Direct PLUS for Graduate Students

A Graduate PLUS loan is only available for graduate students working toward their Master’s or other Professional Degree. Unsubsidized Direct Loan should be used first.  

Current Interest Rate

Current Origination Fee

Repayment Information

How to Apply

  1. File a Free Application for Federal Student Aid (FAFSA)
  2. Graduate students must log-in and apply on StudentLoans.gov
  3. Select the option “Apply for a Direct PLUS Loan.”
  • A credit decision is immediate.
  • If approved, complete the Master Promissory Note and Entrance Counseling on the same site.
    • Select the MPN and Entrance Counseling option for the Graduate PLUS Loan.
    • If denied, two options are available:
      • Request a credit appeal.
      • Provide an endorser.

Federal Perkins Loans - Program is canceled

IMPORTANT: THE FEDERAL PERKINS LOAN PROGRAM HAS BEEN CANCELLED BY THE FEDERAL GOVERNMENT AS OF JULY 1ST, 2018

Perkins is a low-interest federal student loan program. Funds are limited and not guaranteed from year to year. The loan is awarded through Purchase and the loan servicer is the Student Loan Servicing Center (SLSC).

  • The interest rate is fixed at 5.0%
  • Must have financial need
  • No origination fee
  • Repayment begins 9 months after leaving school

Private Loans

 Most experts believe that federal student loans are better than private education loan in terms of repayment options and interest rates. Purchase College’s policy is that it will not certify a private loan that is greater than a student’s Cost of Attendance. We do not steer or influence students in regards to private loan lenders.

Click here for the PDF version of presentation from Student Loan Repayment Workshop

Loan repayment workshop cover page