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Financial Aid - Federal Loans

If you plan on borrowing for college, federal student loans are the most common – and usually the best – loan options.

  • What are Federal Loans?
  • Annual Borrowing Limits
  • Subsidized vs. Unsubsidized
  • A Federal Direct Loan (subsidized and unsubsidized) is a fixed interest loan made to students by the U.S. Department of Education. The amount of your Federal Direct Loan that is subsidized depends upon the results of your FAFSA and other financial aid that you may be offered.

    Federal Direct Loans are based on the cost of attendance (as determined by St. Thomas) minus any other financial aid the student is receiving. 

    All students who are interested in receiving Federal Loans must submit the FAFSA annually.

    • Interest Rate: 5.05%
    • The federal loan origination fee of 1.062%. This fee is deducted from each disbursement.
    • Freshman → $5,500 - no more than $3,500 will be subsidized plus additional $4,000 unsubsidized if student is independent
    • Sophomore → $6,500 - no more than $4,500 will be subsidized plus additional $4,000 unsubsidized if student is independent
    • Junior → $7,500 - no more than $5,500 will be subsidized plus additional $5,000 unsubsidized if student is independent
    • Senior → $7,500 - no more than $5,500 will be subsidized plus additional $5,000 unsubsidized if student is independent

     

    Federal Direct Subsidized Loans are need-based with interest paid by the federal government while the student is enrolled at least half-time (minimum of 6 credits). For new Subsidized Direct Loans, disbursed on or after July 1, 2014, the federal government will also pay the interest through the six-month grace period.

    Interest on unsubsidized loans accrues prior to repayment. The student has the option to make interest-only payments while they attend college or to defer payment (capitalization rules may apply).

     

    What are Federal Loans?

    A Federal Direct Loan (subsidized and unsubsidized) is a fixed interest loan made to students by the U.S. Department of Education. The amount of your Federal Direct Loan that is subsidized depends upon the results of your FAFSA and other financial aid that you may be offered.

    Federal Direct Loans are based on the cost of attendance (as determined by St. Thomas) minus any other financial aid the student is receiving. 

    All students who are interested in receiving Federal Loans must submit the FAFSA annually.

    • Interest Rate: 5.05%
    • The federal loan origination fee of 1.062%. This fee is deducted from each disbursement.

    Annual Borrowing Limits

    • Freshman → $5,500 - no more than $3,500 will be subsidized plus additional $4,000 unsubsidized if student is independent
    • Sophomore → $6,500 - no more than $4,500 will be subsidized plus additional $4,000 unsubsidized if student is independent
    • Junior → $7,500 - no more than $5,500 will be subsidized plus additional $5,000 unsubsidized if student is independent
    • Senior → $7,500 - no more than $5,500 will be subsidized plus additional $5,000 unsubsidized if student is independent

    Subsidized vs. Unsubsidized

     

    Federal Direct Subsidized Loans are need-based with interest paid by the federal government while the student is enrolled at least half-time (minimum of 6 credits). For new Subsidized Direct Loans, disbursed on or after July 1, 2014, the federal government will also pay the interest through the six-month grace period.

    Interest on unsubsidized loans accrues prior to repayment. The student has the option to make interest-only payments while they attend college or to defer payment (capitalization rules may apply).