The Federal Direct Subsidized Loan Program provides long-term, low interest, need-based loans to undergraduate, graduate and professional students.
The Federal Direct Subsidized Loan Program had been disbursed through the Federal Family Education Loan Program (FFELP) prior to the 2010-11 academic year, when the program was switched to the Federal Direct Loan Program.
Interest rates for Direct Subsidized Loans for undergraduate borrowers have a fixed interest rate as follows:

• If first disbursed on or after July 1, 2006 and prior to July 1, 2008, the interest rate is 6.8%.
• If first disbursed on or after July 1, 2008 and prior to July 1, 2009, the interest rate is 6.0%.
• If first disbursed on or after July 1, 2009 and prior to July 1, 2010, the interest rate is 5.6%.
• If first disbursed on or after July 1, 2010 and prior to July 1, 2011, the interest rate is 4.5%.
• If first disbursed on or after July 1, 2011 and prior to July 1, 2012, the interest rate is 3.4%.
• If first disbursed on or after July 1, 2012, the interest rate will return to 6.8%.

The interest rate for the Federal Direct Subsidized Loan Program for graduate borrowers disbursed on or after July 1, 2006 is fixed at 6.8%. The interest rate on loans disbursed prior to July 1, 2006, was variable and set at 3.1 percentage points above the 91-day Treasury bill rate with an 8.25% cap. The interest rate on subsidized Federal Stafford Loans made prior to July 1, 1994, will vary according to the dates on which the loans were disbursed and/or the borrower's outstanding federal loan indebtedness. The interest rate during repayment will be different. These rates are subject to change by law. For specific information about the interest rate on your loans, please contact your lender.

Undergraduates may borrow up to $3,500 for the first year of study, $4,500 for the second year, and $5,500 per year for subsequent undergraduate study, not to exceed a maximum of $23,000. Graduate or professional student may borrow up to $8,500 per year not to exceed $65,500 including any amount borrowed as an undergraduate. Borrowers will not be required to begin repayment of the Federal Direct Subsidized Loan Program until six months after you cease to be enrolled on at least a half-time basis.

Federal regulations require the limitation or reduction of the amount of an unsubsidized or subsidized Federal Direct Loan under certain prescribed conditions. These conditions are as follows: (1) the borrower is an undergraduate, applies for a Stafford Loan and is enrolled less than a full academic year (fall and spring semesters) or (2) the borrower will complete all degree requirements at the end of the semester or term. If both of these conditions occur, the Stafford Loan amount may be reduced and the borrower will be sent notification to review the revised award letter on VIP.

We are required to disburse your loan in at least two installments generally to coincide with the beginning of the enrollment period covered by the loan. Equal installments of your loans will be disbursed at the start of each semester if your loans cover multiple semesters. A loan that covers only one semester or term, however, will be disbursed in full at the beginning of the semester or term.

Additionally, if after the time your Federal Stafford Loan, (subsidized or unsubsidized) was certified, you receive any type of other financial assistance, or your tuition fee structure changes, your eligibility for the Stafford Loan may be reduced. In some cases, you may be required to repay amounts in excess of your eligibility.

For more information about subsidized Stafford Loans, including how to apply, click here.