Federal Direct Loans
Federal Direct Loans are available to eligible students enrolled in an eligible degree program on at least a half-time basis (six credit hours per term).
All degree and certificate programs at the School of Professional and Continuing Studies are eligible except for the Certificate in Information Security and the leadership certificate programs.
Students interested in applying for a Federal Direct Loan must complete:
- The Free Application for Federal Student Aid (FAFSA) for the appropriate school year.
- The Federal Direct Loan application for the appropriate academic period:
These applications must be submitted at least six weeks prior to the start of the term for Direct Loan funding to be available by the time classes begin.
There are two categories of Federal Direct Loans:
Direct Subsidized Loans are made to students who demonstrate eligibility for need-based financial aid. The federal government pays the interest that accrues on the Subsidized Loan while the student is enrolled, and payments need not be made until six months after graduation, withdrawal from school, or reduction to less than half-time status.
Beginning July 1, 2013, a new borrower may receive Federal Direct Subsidized loans for up to 150 percent of the published length of the borrower’s educational program. Should a borrower exceed this period, he or she is no longer eligible for Federal Direct Subsidized Loans. The borrower also becomes responsible for accruing interest during all periods as of the date the borrower exceeds the 150 percent limit. Additional information is provided by the Department of Education.
Direct Unsubsidized Loans are available to those students who do not demonstrate eligibility for need-based aid. Interest does accrue on the Unsubsidized Loan during the student’s enrollment. Repayment of principal plus accrued interest begins six months after graduation, withdrawal from school, or reduction to less than half-time status. (Accrued interest may be paid during enrollment, if the student wishes to do so.)
Annual loan limits vary by the student's year in school. The actual loan amount may be reduced by the expected family contribution and/or other aid. Undergraduates may borrow up to the following amounts from the Direct Loan program:
- Freshmen: $5,500 (no more than $3,500 as a Federal Direct Subsidized Loan)
- Sophomores: $6,500 (no more than $4,500 as a Federal Direct Subsidized Loan)
- Juniors and seniors: $7,500 (no more than $5,500 as a Federal Direct Subsidized Loan)
The loan may be subsidized, unsubsidized, or a combination of the two.
Independent undergraduates may also borrow amounts, in addition to the annual loan limits listed above, from the Direct Unsubsidized Loan:
- Freshmen and sophomores: $4,000
- Juniors and seniors: $5,000
Graduate students may borrow up to $20,500 in Direct Unsubsidized Loan only.
The interest rate for Direct Subsidized and Direct Unsubsidized Loans for undergraduate students disbursed on or after July 1, 2016 and before July 1, 2017, is 3.76%. A 1.069% origination fee is deducted from the amount borrowed.
The interest rate for Direct Unsubsidized Loans for graduate students disbursed on or after July 1, 2016 and before July 1, 2017, is 5.31%. A 1.069% origination fee is deducted from the amount borrowed.
The Standard Repayment Plan allows for a repayment period of 10 years. Alternative repayment plans allowing for a longer repayment period are available.
Upon receipt of the appropriate application materials, the Office of Financial Aid will determine your eligibility and originate your loan. If you have previously borrowed a Direct Loan and signed a Master Promissory Note, then you will not need to sign another Note. New borrowers must sign a Master Promissory Note. First time borrowers must also complete Loan Entrance Counseling. Both may be completed at www.studentloans.gov.
For academic year loans, two equal disbursements are made—one at the beginning of each semester—through a direct credit to your account with the University of Richmond. For summer session and single term loans, one disbursement is made at the beginning of the term.