Columbia University Student Financial Services

Undergraduate Financial Aid

Undergraduate Financial Aid

Federal Direct Subsidized and Unsubsidized Loan

Also known as Federal Direct Stafford Loans and the William D. Ford Direct Loan Program

These are federally guaranteed loan and are described as follows:

  1. The Federal Direct Subsidized Loan is awarded on the basis of financial need, as determined by the results from a Free Application for Federal Student Aid (FAFSA) form . The federal government pays interest on the loan until repayment begins.
  2. The Federal Direct Unsubsidized Loan is not awarded on the basis of financial need. Interest is charged from the time the loan is disbursed until it is paid in full. Students have the option of paying this interest while in school or capitalizing the interest.

To apply for federal funds, you must complete a free FAFSA form and all additional forms that may be required by your individual school's financial aid office.

Note: Before July 1, 2010,Federal Stafford, PLUS, and Consolidation Loans were also made by private lenders under the Federal Family Education Loan (FFELSM) Program. As a result of the Health Care and Education Reconciliation Act of 2010, no further loans will be made under the FFEL Program as of July 1, 2010. All new federal loans will come directly from the Department under the Direct Loan Program.

 


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Eligibility

Eligibility requirements include:

  • Must be a U.S. citizen or eligible non-citizen
  • Must be enrolled at least half-time
  • Cannot be in default or owe a repayment on any Title IV program
  • Must maintain satisfactory academic progress
  • Must complete the required entrance and exit counseling

Full Federal Eligibility Requirements

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Application Process

1. Complete entrance counseling and a Master Promissory Note:

  • Go to Direct Loan website www.studentloans.gov
  • Sign into Manage My Direct Loan using your Social Security Number, the last two letters of your last name, your date of birth and your FAFSA PIN. If you do not have a FAFSA PIN or cannot recall it, please visit to www.pin.ed.gov to request one. Please note that it may take up to ten business days to receive a PIN.
  • Click on "Complete Entrance Counseling" (middle of the page)
  • After completing entrance counseling, click on "Complete Master Promissory Note"
  • Select Type of Loan and click on "Subsidized/Unsubsidized"
2. Contact your school's financial aid office for further information and to complete any additional forms, if necessary.
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Credit Criteria

A credit check is not required for Federal Direct Subsidized and Unsubsidized Loans.

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Annual Loan Limits

  Dependent Undergraduate Student (except students whose parents are unable to obtain PLUS Loans) Independent Undergraduate Student (and dependent students whose parents are unable to obtain PLUS Loans)
First Year
Subsidized: $3,500
Unsubsidized: $2,000
 Subsidized: $3,500
Unsubsidized: $6,000
Second Year
Subsidized: $4,500
Unsubsidized: $2,000
 Subsidized: $4,500
Unsubsidized: $6,000
Third Year and Beyond

Subsidized: $5,500
Unsubsidized: $2,000

 Subsidized: $5,500
Unsubsidized: $7,000

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Aggregate Loan Limits

For dependent undergraduate students: $31,000 (No more than $23,000 of this amount may be in subsidized loans)

For Independent Undergraduate Student (and dependent students whose parents are unable to obtain PLUS Loans: $57,500 (No more than $23,000 of this amount may be in subsidized loans)

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Interest Rates

For Federal Direct Subsidized Loans, the interest rate is fixed at 4.5% (undergraduates only).

For Direct Unsubsidized Loans, the interest rate is fixed at 6.8% for all borrowers (undergraduate and graduate).
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Fees

These loans have an origination fee of 1.0%. However, Federal Direct Loan borrowers will receive an upfront rebate of 0.5% at the time of origination Therefore, the actual amount deducted from the gross amount of the loan borrowed is 0.5%. The fee will be deducted proportionately each time that a loan disbursement is made.

Note: Once in repayment, you must make your first 12 monthly payments on time or the rebate amount will be added back to the principal balance on your loan.

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Disbursement

Loan funds are disbursed directly to your tuition student account generally in at least two installments.The loan funds are first used to pay for tuition and fees, room and board, and other school charges. If any money remains, you can receive a refund. For more information on refunds, please see the Refund page.
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Repayment

 

The first payment is due following a 6-month grace period after you graduate or your enrollment drops to less than half time. Additional deferment periods (i.e., a time when you do not have to make payments) may be available under certain circumstances, such as financial hardship.

Monthly payments are calculated based on the amount owed at the start of repayment. Payments may be adjusted based on your income level. Generally, the repayment period is 10 years. For more information on repayment, please see the Federal Direct Subsidized/Unsubsidized Loan Repayment page.

 

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Additional Resources