Federal Direct Student Loans

Federal Direct Loans are available to eligible students enrolled in an eligible degree or certificate program on at least a half-time basis (six credit hours per term). All degree and certificate programs at Richmond are eligible programs except for the Liberal Arts and Leadership certificate programs and the undergraduate certificate in Performance Coaching Skills.

Students interested in applying for a Federal Direct Loan must complete:

1) The Free Application for Federal Student Aid for the appropriate school year.
2) The appropriate Federal Direct Loan application:

2008 Summer Federal Direct Loan Application
2008-09 Academic Year Federal Direct Loan Application

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.

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 Direct Subsidized Loan)
Sophomores: $6,500  (no more than $4,500 as a Direct Subsidized Loan)
Juniors and Seniors: $7,500  (no more than $5,500 as a 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, of which a maximum of $8,500 may be a Direct Subsidized Loan.

The interest rate for Direct Subsidized Loans for undergraduate students is 6.0%.  The interest rate for Direct Unsubsidized Loans for undergraduates is 6.8%.  The interest rate for both Direct Subsidized and Unsubsidized Loans for graduate students is 6.8%

A 2.0% origination fee, minus the 1.5% rebate, means that total fees of 0.5% are 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 Financial Aid Office 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, to be done electronically per instructions that will be provided to you. First time borrowers must also complete Loan Entrance Counseling (instructions regarding this will be provided to you once your loan has originated).

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.