The US Government provides families access to federal student loans. ALL students borrowing from the Federal Direct Loan Program are required to sign a Master Promissory Note (MPN) and complete online Entrance Counseling for their Direct Loan. Federal loan funds will not be credited to the PSU bill until these items are completed.
Subsidized and Unsubsidized Loans
The Federal Direct loan(s) awarded to you may be subsidized and/or unsubsidized, as described below:
A SUBSIDIZED Federal Direct loan is awarded on the basis of financial need. Interest (4.66% for 2014-2015) will begin accruing at the end of your grace period. Your grace period is 6 months after you graduate, withdraw from school, or are no longer enrolled at least half-time.
An UNSUBSIDIZED Federal Direct loan is a non-need based loan. You will be charged interest (4.66% for 2014-2015) from the time the loan is disbursed until it is paid in full. If you allow the interest to accrue (accumulate) while you’re in school, or during other periods of non-payment, it will be capitalized. This means the interest will be added to the principal amount of your loan at the time of repayment.
All Federal Direct Subsidized or Unsubsidized loans disbursed have a fee charged. For the 2014-15 academic year, loans first disbursed prior to October 1, 2014, will be assessed a fee of 1.072%; loans first disbursed on or after October 1, 2014, will be assessed a fee of 1.073%.
Please note the following eligibility requirements must be met in order to be awarded Federal Direct Loans:
(1) Students must be matriculated (enrolled in a degree seeking program) and enrolled at least half-time (6 credits or more per semester).
(2) Students cannot be in default on any Federal Loans.
(3) Federal Direct annual and aggregate loan limits apply. Dependent undergraduate students are eligible for up to $31,000 (no more than $23,000 of which may be subsidized). Independent undergraduate students and dependent students whose parents are ineligible for a Federal PLUS Loan are eligible for up to $57,500 (no more than $23,000 of which may be subsidized).
Not sure how much your monthly payments will be?
Many online loan repayment calculators can be found online, including the ones at FINAID.org and the Department of Education. You can use these to estimate how much you will need to repay once you graduate. Please note, the longer your loan is in repayment, the more interest you will pay. Calculations are estimates. Values may not reflect the actual amount computed by the Direct Loan Servicing Center.
Verification on who services your federal loans and total amount of federal loans borrowed may be found through the National Student Loan Data System (NSLDS) . This site contains all of your federal Title IV financial aid history, including both grants and loans.
You may also view your PSU Loan History online to estimate the total amount borrowed in Federal, Private and PLUS loans while at PSU. This information pulls student’s loan history accessed from the PSU portal and displays it to help each student understand the impact of loan debt upon graduation and repayment. Students can track this information beginning their first year at PSU through the time they graduate.
Information about loan discharge and cancellations can be found on the Department of Education website.
The Federal Student Aid Ombudsman of the Department of Education helps resolve disputes and solve other problems with federal student loans. Please do not hesitate to contact them at 877-557-2575 should you feel they can be of assistance.