Q. What is a Direct Subsidized and/or Unsubsidized Loan?
A. Direct Subsidized and Unsubsidized Loans are fixed interest rate federal loans. Subsidized loans are available to undergraduate students who demonstrate financial need as determined by the current year FAFSA; unsubsidized loans are available to all undergraduate and graduate students who have completed a current year FAFSA and have eligibility remaining in their loan aggregate.
The federal government has permanently limited eligibility for subsidized loans to 150 percent of the length of the student’s academic program for new borrowers beginning on or after July 1, 2013. The 150 percent change means students in a four-year program will be eligible for subsidized student loans for the equivalent of six years – three years for students in a two-year program. The student who reaches this limitation may continue to receive Unsubsidized Direct Loans if he or she is otherwise eligible (for example, student continues to meet the school’s satisfactory academic progress requirements).
Once a borrower has reached the 150 percent limitation, his or her eligibility for an interest subsidy also ends for all outstanding subsidized loans that were disbursed on or after July 1, 2013. At that point, interest on those previously borrowed loans would begin to accrue and would be payable in the same manner as interest on unsubsidized loans.
The Direct Loan Program has replaced the FFEL Program Stafford Loans.
Q. How do I apply for the Direct Subsidized and Unsubsidized Loan Program?
A. In order to apply for Direct Subsidized and Unsubsidized Loans, students will need to complete a FAFSA and the La Salle University Institutional Data Form (IDF).
Upon receiving your Financial Aid award letter, you will receive instructions for completing your Master Promissory Note (MPN) and Entrance Interview.
Q. Will I need to complete a Direct Subsidized and Unsubsidized Loan Master Promissory Note (MPN)?
A. Yes, all students must complete a Direct Subsidized and Unsubsidized Loan MPN, even if they completed a FFELP Stafford Loan MPN in the past. You will be sent the link to complete the MPN online, which only needs to be signed once during your borrowing career. The MPN you sign will list the U.S. Department of Education as the lender. Loans that are requested for subsequent years will be added to your MPN. The MPN is a legally binding document that states your agreement to repay your loan to the Department. Students will need the Department of Education-issued Personal Identification Number (PIN) to complete the process. This is the same PIN that you used to sign your FAFSA.
Q. Will I need to do a Direct Subsidized and Unsubsidized Loan Entrance Interview?
A. Students who are first-time borrowers will need to complete an Entrance Interview. Before you sign your DL MPN online, you will do your DL Entrance Interview. Repayment of student loans is a serious responsibility, and the Entrance Interview will explain your rights and responsibilities. Like the Direct Loan MPN, you will only need to do the Entrance Interview once.
*All previous borrowers who have completed a FFELP Stafford Loan Entrance Interview will NOT have to complete a new one under Direct Lending.
Q. What are the eligibility requirements?
A. In order to be eligible for Direct Subsidized and Unsubsidized Loans, undergraduate students must be enrolled for a minimum of 6 credits per semester.
Graduate students must be enrolled for a minimum of 3 graduate level credits in order to be eligible for Direct Unsubsidized Loans (no Subsidized eligibility).
All students must meet general eligibility requirements for the Federal Student Aid (FSA) programs.
*La Salle University will review your FAFSA and all submitted documentation and notify you of your eligibility for the Direct Subsidized and Unsubsidized Loans.
Q. How do I, as an undergraduate student, qualify for the additional Direct Unsubsidized Loan?
A. Initially, all undergraduate students are offered $2000 of Direct Unsubsidized Loans in their award letters. You are eligible for additional Direct Unsubsidized Loan funds if you are independent or your parents were denied a Direct PLUS loan. The additional amounts are $4000 for each freshman and sophomore years and $5000 for each junior and senior years.
Q. Who can answer questions about my Direct Loan?
A. Any questions you may have regarding the application should be addressed to La Salle University Student Financial Services. You may e-mail firstname.lastname@example.org or call 215-951-1070.
E-mail us at email@example.com.