Getting loans to pay for higher education is not something new. There are lots of student loans and financial aid offered by the government, banks, and other educational and financial institutions nowadays. Nonetheless, the question is, Are you familiar with Federal Direct Subsidized loans? Who are eligible to apply for these loans? And, how much can you borrow in direct subsidized loans?
Unlike other student loans and financial aids, federal direct subsidized loans are offered on as-needed base. While the student is still studying, the federal government shoulders for the payment of all the interest of the direct loan. However, the student should be enrolled in school with no less than half-time and for the period of the 6 months grace period.
In able to be eligible for these loans, one must first meet the requirements for federal financial aid as indicated under the PELL grant. As there are different types of PELL grants, make sure you fulfill the right requirements for the grant that you’re applying for.
Another thing that would deem you eligible for the loan is that you must validate your financial need for the loan. To do this, the EFC, together with the loan amount, plus any other financial aid you are availing (if there are any) sums up to less than your cost of attendance.
The amount of money that you can borrow from the direct subsidized loan depends on the academic level. For first year (fewer than 30 credits earned), the maximum loan is up to $3,500 annually. For second year (30 or more credits earned), $4,500 is the annual maximum loan. All in all, the undergraduate aggregate maximum should not be greater than $23,000. These apply for both dependent and independent students. Wherein, dependent students are those students who have their parents paying the loan for them.
For more information on applying for a federal direct subsidized loan, you may visit their website at www.studentaid.ed.gov.