Federal Direct Loans are low-interest loans offered by the U.S. Department of Education to eligible students. There are two types of Federal Direct Loans: subsidized and unsubsidized. For complete information about the Federal Direct Loan program, including current interest rates, annual limits and aggregate limits, visit the Federal Student Aid website.
Eligibility for a subsidized loan is based on financial need as determined by your cost of attendance and estimated family contribution (EFC). With this loan, the government will pay the interest while you are enrolled at least half time (6 credits), during your grace period (unless you received a subsidized loan that was first disbursed between July 1, 2012, and July 1, 2014), and during any periods of deferment.
A FAFSA is required to receive an unsubsidized loan, but eligibility is not based on financial need. The amount will be determined based on your cost of attendance, any other aid received, and the federal annual loan limits. With this loan, interest will start accruing as soon as it is disbursed.
- You must meet the eligibility requirements listed above.
- You must not exceed federal aggregate loan limits.
- Once you receive your Award Notification in your student email, go into your myMadisonCollege Student Center (full site) and accept or decline your awards. Awards usually include both the fall and spring semester for that aid year. When accepting your loans, be sure you are accepting enough for the entire aid year.
- Complete Entrance Counseling at the Student Loans website to better understand your responsibilities and obligations by borrowing student loans.
- Complete a Subsidized/Unsubsidized Master Promissory Note (MPN) at the Student Loans website. The MPN is a legal document in which you are promising to repay your loan(s) and any accrued interest and fees to the U.S. Department of Education.
- View the disbursement page for additional information on when you will receive your funds.
If you have received Federal Direct Loan(s) and you graduate, drop below half-time status or withdraw, you must complete exit counseling at the Student Loans website. The purpose of exit counseling is to inform you of your obligations and options regarding the repayment of your Federal Direct Loan(s).