Direct Subsidized and Unsubsidized Loans

Direct Subsidized Loans

The Direct Subsidized Loan is available to students with financial need as determined by the FAFSA. The government pays or subsidizes the interest on behalf of students while they are enrolled at least half time.

Important Changes to the Direct Subsidized Loan Program Effective July 1, 2012

  • Graduate and Professional students will NOT be eligible for Direct Subsidized Loans made for periods of enrollment (loan periods) beginning on or after July 1, 2012.
  • The Grace Period Interest Subsidy has been eliminated. The government will no longer subsidize or pay the interest on behalf of students during the six month grace period after graduation or when students are no longer enrolled at least half-time. This is effective for new Direct Subsidized Loans disbursed on or after July 1, 2012.
  • The up-front Interest Rebate (reduction to the origination fee) that has been provided to borrowers at the time of loan disbursement will not be offered on any Direct Loan disbursed on or after July 1, 2012.
  • The interest rate on Direct Subsidized Loans made to undergraduate students on or after July 1, 2012 will increase from a fixed 3.4% to a fixed 6.8%.

Direct Unsubsidized Loans

The Direct Unsubsidized Loan is available to undergraduate and graduate students without regard to financial need. The student is responsible to pay the interest that accrues and may elect to pay while in school or to have it deferred.

 

Interest Rates Effective July 1, 2012

  • 6.8 % Fixed Undergraduate Direct Subsidized Loan
  • 6.8% Fixed Undergraduate and Graduate Direct Unsubsidized Loan

Loan Fee Rates Effective July 1, 2012

  • The up-front Fee Rebate will no longer be available for any Direct Loan disbursed on or after July 1, 2012
  • An Origination Fee of 1% will be deducted from the total loan prior to disbursement.

Loan Limits

The maximum amount you can borrow each year in Direct Subsidized and Unsubsidized Loans depends on your grade level and on whether you are a dependent student or an independent student. Click here to see the Loan Limit Chart. Reminder: Graduate and Professional students are no longer eligible for the Direct Subsidized Loan effective July 1, 2012.

 

First-time ORU Direct Loan borrowers complete the following to apply:

Click on https://studentloans.gov/myDirectLoan/index.action to complete the Direct Loan Master Promissory Note and the Direct Loan Entrance Interview. The Direct Loan Entrance Interview requirement may also be accessed through http://vision.oru.edu/.

 

Repayment

No payments are required while a student is enrolled in school at least half time or during the six months after graduation (grace period). Due to new Federal regulations, the interest on new Direct Subsidized Loans disbursed on or after July 1, 2012, is no longer subsidized during the grace period. 

Eligibility

  • Direct Loans are available to undergraduate and graduate students who have completed the FAFSA and who are U.S. citizens or eligible noncitizens enrolled at least half time in an eligible program at an eligible school.
  • The amount of the subsidized and unsubsidized loan award will be determined by the student's need (based on the results of the FAFSA) in conjunction with the student's grade level and dependency status.
  • An award notification will be sent to the student to inform them of their eligibility.
  • Students may choose to accept or decline all or part of the loan award.
  • The school may be required to adjust the loan amount if the student's FAFSA or enrollment changes.
  • The loan is disbursed in two equal payments per academic year; at the beginning of the fall semester and at the beginning of the spring semester.
  • Timely disbursement is dependent upon the student completing their financial aid file.