Financial Aid: Federal Direct Loans

Federal Direct Loans

The Federal Direct Loan is a long-term, low-interest loan that is awarded by the Office of Financial Aid. The lender is the U.S. Department of Education.  This loan is not based upon your credit history or income.  The amount you may receive for the academic year is based on your financial need and academic level and is determined by the Office of Financial Aid.

Repayment of the principal begins 6 months after you cease half-time enrollment, and the average repayment term is 10 years.

Interest Rates

Current interest rates on all Federal Direct Loans are fixed.

Loan Type Grade Level First Disbursed Between 7/1/17 and 7/1/18
Subsidized Loans Undergraduate 4.45%
Unsubsidized Loans Undergraduate
PLUS Loans Parent

Note: The interest rates for federal student loans are determined by federal law. If there are future changes to federal law that affect federal student loan interest rates, we will update this page to reflect those changes.

Borrower Eligibility

Degree seeking students who are enrolled at least half-time may receive Direct Loan funding as long as they meet all general eligibility requirements.

Borrowing Limits

The Direct Loan amount shown on the student’s financial aid award is the Financial Aid Office’s estimate of the student’s eligibility. As a general rule, the following grade-level maximums apply.

Year in School Base Amount Additional Unsubsidized *Additional Unsubsidized
Freshman 0-29 Credits $3,500 $2,000 $4,000
Sophomore 30-59 Credits $4,500 $2,000 $4,000
Junior 60-89 Credits $5,500 $2,000 $5,000
Senior 90+ Credits $5,500 $2,000 $5,000


When it comes time to start repaying your student loan(s), you can select a repayment plan that’s right for your financial situation. Generally, you'll have from 10 to 25 years to repay your loan, depending on which repayment plan you choose.

Planning for repayment is essential to your credit health. Detailed information and repayment calculators.


Under certain conditions, federal regulations allow students to defer loan repayment. The most common deferments are for enrollment on at least a half-time basis, unemployment, and economic hardship. During a deferment, the federal government will pay interest that accrues on any subsidized funds. Interest on unsubsidized loans is the student’s responsibility.


    How Do I Apply?

    Complete the FAFSA online to apply for financial aid. For more information on applying, please visit Marywood's Application Process page.

    1. Review your Financial Aid Award letter
      All eligible students are offered a Federal Direct Loan.  If you want to reduce or decline your loan entirely, please email the Financial Aid Office at  In the subject of the email put: “Cancel/reduce my loan”.   In the body of the email, provide your Marywood student ID, first and last name and instructions to reduce or adjust your loan.

    2. Complete the Master Promissory Note (MPN) and Loan Counseling
      The Financial Aid Office will originate your loan electronically with the US Department of Education.  If this is your first Direct Loan, you must sign a Direct Loan Master Promissory Note (MPN) via the web and complete Entrance Loan Counseling at

    3. Receive your loan funds
      After you have signed the MPN and you have completed Entrance Loan Counseling, your loan will be scheduled for disbursement. If your loan is for the full academic year, your loan will be disbursed in two equal disbursements – one at the beginning of the fall semester and one at the beginning of the spring semester. Your loan funds will first offset any outstanding charges you owe the university for the semester, and after your charges are paid in full, a refund of any excess loan proceeds will be disbursed to you by check.

    4. The National Student Loan Data System (NSLDS) is the US Department of Education's centralized resource for information about all federal student loans that you have borrowed. You can find information about all of your current and prior student loans, even those you may have borrowed at a prior college or university.

    PLUS (Parent Loans)

    Parents can borrow a PLUS Loan to help pay your education expenses if you are a dependent undergraduate student enrolled at least half-time in an eligible program at an eligible school. Interest rates and repayment provisions on PLUS loans are generally more favorable than other consumer loans available for educational expenses. Complete the FAFSA prior to applying for the Plus loan online at

    Parents are required to pass a credit check when they are applying for the PLUS loan. If a parent's application for a PLUS loan is denied based on the borrower's credit history, the student may become eligible for an additional unsubsidized student loan. Freshmen and sophomore students can borrow up to $4000 in additional unsubsidized loans, while juniors and seniors can borrow up to $5000 in additional unsubsidized loans .

    Application Process

    • The parent borrower submits the PLUS Request Process.
    • The federal loan processing center will review borrower’s credit history to determine eligibility.
    • Once the PLUS loan has been approved, the parent will be instructed to sign a “Master Promissory Note".
    • The Financial Aid Office will originate the parent PLUS loan.
    • Loan proceeds will be used to pay outstanding charges on the student’s billing account in the University Cashier’s Office.
    • If there are remaining funds available after the authorized charges are paid, a refund will be made available to the student or parent depending upon the parent’s designation when completing the PLUS application.
    • Because a credit decision only lasts for 90 days, parents are encouraged to wait until July 1 immediately preceding the start of each new academic year before making application for a PLUS loan. If the 90 days expire before the loan is disbursed, parents may need to make a new application with a new credit check.

    PLUS (Graduate and Professional Degree Students)

    The Federal Graduate PLUS Loan is a Federal loan program which allows Graduate and Professional students to borrow a low interest federally backed student loan when Federal Direct Loan eligibility has been exhausted. Like the Parent PLUS Loan, the Graduate PLUS Loan can be used to pay for the total cost of attendance minus any financial aid you've already been awarded. Also like the Parent PLUS Loan, eligibility for the Graduate PLUS Loan is largely dependent on the borrower's credit rating and history. Students should follow the same application procedures outlined above for parent borrowers. First-time Graduate PLUS borrowers must complete a Master Promissory Note (MPN) and complete Entrance Loan Counseling.

    Resolving Loan Disputes and Problems

    The SFA Ombudsman's Office has been created by the U.S. Department of Education to help student loan borrowers resolve loan disputes and problems.

    The Ombudsman Customer Service Line is (877) 557-2575.

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