Loans
Federal Direct Loans
The Federal Direct Loan is available through the Federal Direct Loan Program to help UMMC's undergraduate and graduate students pay for their education.
There is only one type of Federal Direct Loan available to Graduate level students - unsubsidized. Federal Subsidized Loans are only available to Undergraduate students.
Direct Subsidized Loan
A subsidized loan borrowed through the Direct Loan Program offers undergraduate students a low, fixed interest rate and flexible repayment terms. This loan is available to students who demonstrate financial need. With a subsidized loan, interest does not accrue during in-school, grace, and deferment periods.
To apply for a federal student loan, complete and submit a Free Application for Federal Student Aid (FAFSA®) form. Based on the results of your FAFSA form, your college or career school will send you a financial aid offer, which may include federal student loans. Your school will tell you how to accept all or a part of the loan.
Before you receive your loan funds, you will be required to
- complete entrance counseling, a tool to ensure you understand your obligation to repay the loan and
- sign a Master Promissory Note, agreeing to the loan terms.
Direct Unsubsidized Loan
An unsubsidized loan borrowed through the Direct Loan Program offers undergraduate, graduate, and professional students a low, fixed interest rate and flexible repayment terms. You don’t need to show financial need to qualify.
How can I pay less interest?
The borrower is generally responsible for paying all the accumulated interest until the loan balance is paid off. Learn about how to pay your loan off more quickly.
How do I apply for federal student aid?
To apply for any federal student aid, you need to submit the Free Application for Federal Student Aid (FAFSA®) form. Your school will use the information from your FAFSA form to determine how much federal student aid you’re eligible to receive.
Before you receive your loan funds, you’ll be required to
- complete entrance counseling, a tool to ensure you understand your obligation to repay the loan and
- sign a Master Promissory Note agreeing to the terms of the loan.
Direct PLUS Loan for Parents
Direct PLUS loans can help pay for education expenses not covered by other financial aid. The U.S. Department of Education makes Direct PLUS Loans to eligible parents through schools participating in the Direct Loan Program.
To receive a parent PLUS loan, you must
- be the biological or adoptive parent (or in some cases, the stepparent) of a dependent undergraduate student enrolled at least half-time at an eligible school;
- not have an adverse credit history (unless you meet certain additional requirements); and
- meet the general eligibility requirements for federal student aid
Note: Grandparents (unless they have legally adopted the dependent student) and legal guardians are not eligible to receive parent PLUS loans, even if they have had primary responsibility for raising the student.
Loan Interest Rates and Fees
For Direct PLUS Loans first disbursed on or after July 1, 2024, and before July 1, 2025, the interest rate is 9.08%. This is a fixed interest rate for the life of the loan.
Additionally, there is a loan fee on all Direct PLUS Loans. The loan fee is a percentage of the loan amount proportionately deducted from each loan disbursement. The percentage for all Direct PLUS loans first disbursed on or after Oct. 1, 2020, is 4.228%. Loans first disbursed before that date had different loan fees.
How to Apply
Go to the online Direct PLUS Loan Application for Parents.
Note: Before applying for a parent PLUS loan, ensure your child has completed the FAFSA form.
Steps to Receive a Loan
If you are eligible for a parent PLUS loan, you will be required to sign a Direct PLUS Loan Master Promissory Note (MPN), agreeing to the terms of the loan.
If you’re taking out parent PLUS loans for more than one child, you’ll need to sign separate Direct PLUS Loan MPNs for the loans you receive for each child.
Direct PLUS Loan for Graduate or Professional Students
Direct PLUS loans can help pay for education expenses not covered by other financial aid. The U.S. Department of Education makes Direct PLUS Loans to eligible graduate or professional students through schools participating in the Direct Loan Program.
To receive a graduate PLUS loan, you must
- be a graduate or professional student enrolled at least half-time at an eligible school;
- not have an adverse credit history. If you have placed a security freeze on your credit file, you must lift or remove the freeze at each credit bureau before you continue. Your application will not be processed if you have a security freeze on your credit file.
- meet the general eligibility requirements for federal student aid
Loan Interest Rates and Fees
For Direct PLUS Loans first disbursed on or after July 1, 2024, and before July 1, 2025, the interest rate is 9.08%. This is a fixed interest rate for the life of the loan.
Additionally, there is a loan fee on all Direct PLUS Loans. The loan fee is a percentage of the loan amount proportionately deducted from each loan disbursement. The percentage for all Direct PLUS loans first disbursed on or after Oct. 1, 2020, is 4.228%. Loans first disbursed before that date had different loan fees.
How to Apply
Apply for a Grad PLUS Loan | Federal Student Aid
Note: Before applying for a graduate PLUS loan, please complete the FAFSA form.
Steps to Receive a Loan
If you are eligible for a graduate PLUS loan, you will be required to sign a Direct PLUS Loan MPN by visiting Completing a Master Promissory Note | Federal Student Aid, agreeing to the loan terms.
Eligibility
Your Direct Loan eligibility is determined by the Office of Student Financial Services and is based on information you provided in the Free Application for Federal Student Aid (FAFSA).
Federal criteria include:
- Enrollment in an eligible school at least half-time in a degree program
- U.S. citizenship, permanent residency, or eligible noncitizen status
- Satisfactory academic progress (as determined by the Office of Financial Aid)
- No unresolved defaults or overpayments owed on Title IV educational loans and grants
- Satisfaction of all Selective Service Act requirements
Borrowing limits
Borrowing limits are based on your dependency status and year in school. You are considered independent if you will be working on a degree beyond a bachelor's degree during the school year.
You can never borrow more than the cost of education, less other financial aid received (special rules apply for recipients of Montgomery Chapter 30 VA benefits and Americorps benefits). Below are the maximum amounts you may borrow.
Third Year and Beyond Undergraduate Annual Loan Limit
| Dependent Students (except students whose parents are unable to obtain PLUS Loans) | Independent Students (and dependent undergraduate students whose parents are unable to obtain PLUS Loans) | |
|---|---|---|
| Subsidized Loan Limit | $5,500 | $5,500 |
| Unsubsidized Loan Limit | $2,000 | $7,000 |
| Total Loan Limit | $7,500 | $12,500 |
As a graduate student, your subsidized and unsubsidized Direct Loan annual eligibility is as follows:
Graduate/Professional Students can borrow a maximum total of $138,500. Medical and Dental students may borrow a maximum of $224,000. These loan limits include all loans borrowed as an undergraduate.
Loan fees
Most federal student loans have loan fees that are a percentage of the total loan amount. The loan fee is deducted proportionately from each loan disbursement you receive while enrolled in school. This means the money you receive will be less than the amount you actually borrow. You’re responsible for repaying the entire amount you borrowed and not just the amount you received.
Studentaid.gov has the most updated info on the current loan fee rates.
Disbursement of funds
An Electronic Funds Transfer (EFT) will be sent directly to our school. The amount of the proceeds will be the loan amount less the fees. Funds will credit first to your tuition bill and any excess funds will be mailed to your permanent address or directly deposited to your personal account.
Student Loan Exit Counseling
Direct Loan Exit Counseling is mandatory for students with federal student loans who are graduating, leaving school, or dropping below half-time enrollment. Its purpose is to educate borrowers about their loan obligations, repayment options, and potential strategies for managing their debt.
What Exit Counseling Covers:
- Your rights & responsibilities as a borrower
- Loan Repayment options
- Tools for budgeting & financial planning
To complete Student Loan Exit Counseling, you may visit Exit Counseling | Federal Student Aid.