Federal Direct Unsubsidized Loan

What is A Federal Direct Unsubsidized Loan?


A federal loan awarded to all students who apply for financial aid and who are U.S. Citizens or permanent residents. The student must be enrolled at least half-time in a degree seeking program to be eligible for the Federal Direct Unsubsidized Loan.

Unsubsidized means that you are responsible for the interest from the time the loan is disbursed. While you are enrolled at least half-time you may defer interest payments and capitalize the interest. Capitalization means that the interest is added to the loan balance, increasing the loan's size and cost. To reduce the total cost of your loan, consider making in-school interest only payments.  If you would like to make in-school interest payments, please contact your loan servicer.


How much am I eligible to receive?

Current annual Federal Direct Loan limit per year:

Program of Study

Unsubsidized Limit

Loyola Law Students



Current 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.

Program of Study


Loyola Law Students


What is the Interest Rate?

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 Federal Direct 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. 

What are the fees?

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

  • 1.069% for 2016-2017 loans disbursed on or after October 1, 2016
  • 1.066% for 2017-2018 loans disbursed on or after October 1, 2017

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 student account.

When do I pay the loan back?

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. However, various repayment options are available and the loan repayment period can be extended, if needed via consolidation. There is no prepayment penalty, so you can pay the loan earlier if you wish.

How do I apply?