If you’re an undergraduate or graduate student, you can apply for a Federal Direct Loan regardless of financial need or credit history. To apply for a Federal Direct Loan, you must file your FAFSA each year and meet the eligibility requirements:
Learn how annual and total loan limits may affect you.
Interest rates may change each July 1.
There is a fee for both subsidized and unsubsidized loans.
If you meet all requirements, you can borrow up to an annual maximum and a lifetime maximum. Your loan will pay for your tuition, fees, room and board, books, and other education-related expenses. Any funds that remain after these items are paid will be refunded to you.
There are two types of Federal Direct Loans: subsidized and unsubsidized.
Direct Subsidized Loans are available to undergraduate students whose Expected Family Contribution shows that they need money for college. If you get a Direct Subsidized Loan, the U.S. Department of Education pays any interest that accrues while you’re enrolled at least half time. (Note that there are certain situations where you’ll become responsible for paying interest on the loan.)
There is a time limit on how long you may receive Direct Subsidized Loans: up to 150 percent of the published length of your program.
Direct Unsubsidized Loans are available to both undergraduate and graduate students. You do not need to show financial need to qualify. You’re responsible for paying all interest on the loan.
You’ll begin repaying your loan six months after you graduate or drop below half-time status. First, you’ll be asked to complete exit counseling, which will provide you with information on repaying your loan. We’ll send you an email to notify you when it’s time for you to go through exit counseling.
To apply, complete your FAFSA. If you’re a first-time Federal Direct Loan borrower at IU, you’ll need to go through entrance counseling and sign a Master Promissory Note (MPN) after your loan is approved.