Direct Subsidized & Unsubsidized Loans
Direct Loans (previously known as Stafford Loans) are offered directly through the Department of Education to students who are enrolled at least half time and pursing a degree.
Subsidized vs. Unsubsidized
You can be eligible for both subsidized and unsubsidized loans depending on your financial need calculated by the Free Application for Federal Student Aid (FAFSA).
- Subsidized loans are for students who demonstrate need. The federal government pays the interest while you’re enrolled in school (at least half time, pursuing a degree or certificate). They also pay your interest during the 6-month grace period after leaving school.
- Unsubsidized loans are not based on need. You are responsible for all the interest that accrues. You can choose to pay the interest while you’re in school or have the accrued interest added to your loan when you enter repayment.
Interest Rates
Direct Subsidized and Unsubsidized Loans have a fixed interest rate for the life of the loan. Rates vary depending on when the loan is disbursed and if a loan is subsidized or unsubsidized.
| Loans First Disbursed | Subsidized | Unsubsidized |
|---|---|---|
| July 1, 2012 to June 30, 2013 | 6.8% | 6.8% |
| July 1, 2011 to June 30, 2012 | 3.4% | 6.8% |
| July 1, 2010 to June 30, 2011 | 4.5% | 6.8% |
| July 1, 2009 to June 30, 2010 | 5.6% | 6.8% |
| July 1, 2008 to June 30, 2009 | 6.0% | 6.8% |
| July 1, 2007 to June 30, 2008 | 6.8% | 6.8% |
Loan Fees
What is a loan fee? It’s what you pay the lender to help cover the cost of processing your loan. It is typically calculated as a percentage of the amount you’re borrowing.
The fee for Direct Subsidized and Unsubsidized Loans is 1%, however, a 0.5% rebate reduces this fee to a net of 0.5%. Once you begin repayment you must make 12 on-time monthly payments to retain this benefit.
Amount
The maximum amount you can borrow depends on your status and the number of credits you have earned.
| Credits Earned | Dependent Students | Independent Students |
|---|---|---|
| 0-29 credits (Freshman level) |
$5,500 - No more than $3,500 of this amount may be subsidized | $9,500 - No more than $3,500 of this amount may be subsidized |
| 30-59 credits (Sophomore level) |
$6,500 - No more than $4,500 of this amount may be subsidized | $10,500 - No more than $4,500 of this amount may be subsidized |
| 60+ credits (Junior & Senior level) |
$7,500 - No more than $5,500 of this amount may be subsidized | $12,500 - No more than $5,500 of this amount may be subsidized |
| Maximum Total When You Graduate | $31,000 - No more than $23,000 of this amount may be in subsidized loans | $57,500 - No more than $23,000 of this amount may be in subsidized loans |
How to Apply
- Follow the steps to apply for financial aid.
- Bethel will send you a financial aid award notifying you of loan eligibility.
- If you're eligible, make sure you process your loan at least 1 month before you start classes.
More About Direct Loans
For more on Direct Loans, check out information from the U.S. Department of Education:
