Federal Direct Loans

Federal student loans are available to most students regardless of income and provide a range of repayment options including income-based repayment plans and loan forgiveness benefits, which other education loans are not required to provide.
 
To apply for a Direct Loan, you must first complete and submit the Free Application for Federal Student Aid (FAFSA) form. To be eligible, you must be a U.S. citizen or permanent resident, be enrolled at least half-time, be enrolled in an eligible program, and mantain satisfactory academic progress (SAP)

Annual Federal Loan Limits

Based on academic level and federal dependency status, students may borrow up to the amounts listed in the table below on an annual basis. 

 *Non Degree Credential and Post-Baccalaureate Pre-Medical students may be eligible to receive a Direct Subsidized loan based on dependency. 

program of studyFederal Direct Loans
Non-Degree Credential & Postbac Pre-medical up to $12,500 (subsidized/unsubsidized) 
Graduate Degree $20,500 (unsubsidized)
Doctoral  $20,500 (unsubsidized)
Law  $20,500 (unsubsidized)

    

Aggregate Federal Loan Limits

Based on academic level and federal dependency status, students may borrow up to the amounts listed in the table below for their entire academic careers.

dependency and program of studyDirect subsidizedMaximum direct subsidized and unsubsidized
Dependent undergraduate $23,000 $31,000
Independent Undergraduate $23,000 $57,500
Graduate students $0 $138,500
Law students $0 $138,500


Interest Rates

The Bipartisan Student Loan Certainty Act of 2013 sets the annual interest rate on Direct Unsubsidized Loans issued to graduate or professional students at the rate on high-yield 10-year Treasury notes plus 3.6%, but caps that rate at 9.5%. As a result, rates are expected to change annually. Students that borrow the Direct Unsubsidized Loan over multiple years will have a set of fixed-rate loans, each with a different interest rate.

  • For the 2016-2017 academic year, the interest rate is fixed at 5.31% for the life of loans disbursed after July 1, 2016.
  • For the 2017-2018 academic year, the interest rate is fixed at 6% for the life of loans disbursed after July 1, 2017.

Loan Fees

Direct Loans require origination fees that are deducted from each disbursement. The net disbursement is the gross loan amount, less origination fees.

  • Origination fee is 1.069% (deducted from loan proceeds) for loans disbursed after October 1, 2016, but before October 1, 2017.
  • Origination fee is 1.066% (deducted from loan proceeds) for loans disbursed after October 1, 2017, but before October 1, 2018.
  • Origination fees change annually based on the U.S. 10-year Treasury bill.

How will the loan funds be sent?

Provided that you have completed the online Direct Loan Entrance Counseling session and the electronic Master Promissory Note (MPN), the loan will be sent in two disbursements; first disbursement in the fall semester and the second disbursement in the spring. These funds arrive via Electronic Fund Transfer (EFT) and are applied directly to your LMU student account.

When do I begin repayment?

Repayment on this loan will begin after your grace period, 6 months after you graduate or cease to be enrolled at least half-time. You have 10 years to pay the loan back. Various repayment options are available and the loan period can be extended, if needed via consolidation. There is no prepayment penalty, so you can pay the loan earlier if you wish.