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Federal Direct Loans

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To apply for your Direct Loan and all other forms of financial aid, visit www.bc.edu/financialaid.

Direct Loans are low-interest loans for students and parents to help pay for the cost of a student's education after high school. The lender is the U.S. Department of Education (the Department), though the entity you deal with once you go into repayment, your loan servicer, can be a private business.

With Direct Loans a student may borrow directly from the Federal government and have a single contact—your loan servicer—for everything related to repayment, even if you receive Direct Loans at different schools. Each student will have online access to individual Direct Loan account information via the servicer's web site. Students can choose from several repayment plans that are designed to meet the needs of almost any borrower and can switch repayment plans if your needs change.

The Direct Loan Program offers the following types of loans:

Subsidized Direct Loan

  • 4.66% fixed interest rate during repayment (as of July 1, 2014)
  • 1.072% origination fee
  • Both interest and principal are deferred through enrollment
  • Repayment on both principal and interest beginning six months after the student ceases to be enrolled in school on at least a half-time basis, generally extending over a 10-year period
  • $23,000 maximum base aggregate undergraduate borrowing limit

Unsubsidized Direct Loan

  • 4.66% fixed interest rate during repayment (as of July 1, 2014)
  • 1.072% origination fee
  • Interest accrues while the student is enrolled as well as during the grace and repayment periods
  • Repayment on both principal and interest beginning six months after the student ceases to be enrolled in school on at least a half-time basis, generally extending over a 10-year period
  • $31,000 maximum base aggregate undergraduate borrowing limit (combined subsidized and unsubsidized loans) for dependent students, $57,500 for independent students (combined subsidized and unsubsidized loans)

Graduate Unsubsidized Direct Loan

  • 6.21% fixed interest rate during repayment (as of July 1, 2014)
  • 4.288% origination fee
  • Repayment on both principal and interest beginning six months after the student ceases to be enrolled in school on at least a half-time basis, generally extending over a 10-year period
  • $65,500 maximum base aggregate undergraduate borrowing limit

Direct Annual Loan Limits

Effective for loans first disbursed on or after July 1, 2008:

Grade Level Subsidized Federal
Direct Loan
Unsubsidized Federal
Direct Loan
Total Federal
Direct Loan
Freshman $3,500 Dependent = $2,000
Independent = $6,000
Dependent = $5,500
Independent = $9,500
Sophomore $4,500 Dependent = $2,000
Independent = $6,000
Dependent = $5,500
Independent = $10,500
Junior/Senior $5,500 Dependent = $2,000
Independent = $7,000
Dependent = $7,500
Independent = $12,500
Aggregate Loan Limits $23,000   Dependent = $31,000
Independent = $57,500
Graduate and Professional $8,500 $12,000 $20,500
Aggregate Loan Limits $65,500   Total Undergraduate, Graduate, and Professional = $138,500

 

To determine eligibility for a Direct loan, you must apply for financial aid each year by submitting the FAFSA (online) or a paper FAFSA (PDF) and all other required documentation.

Entrance Counseling

Except for parent Direct PLUS Loan borrowers, if you haven't previously received a loan, you must complete Entrance Counseling before your school can make the first disbursement of your loan. This helps you understand your responsibilities regarding your loan. You can complete this counseling online.

Completing Entrance Counseling (PowerPoint Presentation)

The Master Promissory Note

To take out a Direct Loan for the first time, you must complete a Master Promissory Note (MPN). You can complete the MPN online at the StudentLoans.gov web site. The MPN is a legal document in which you promise to repay your loan(s) and any accrued interest and fees to the Department. It also explains the terms and conditions of your loan(s).

To complete an MPN online, you will be required to use your Department of Education–issued PIN. If you do not have a PIN, you may request one from the official PIN website.

In most cases, once you've submitted the MPN and it's been accepted, you won't have to fill out a new MPN for future loans you receive.

You'll receive a disclosure statement that gives you specific information about any loan that the school plans to disburse under your MPN, including the loan amount, fees, and the expected disbursement dates and amounts.

Completing a Master Promissory Note (PowerPoint Presentation)

Resources for Students/Borrowers