Federal Direct Loan
The Federal Direct Loan program provides low interest, long term loans to eligible students through the U.S. Department of Education. All federal loans require you to complete the Free Application for Federal Student Aid (FAFSA). All loans must be repaid.
Entrance and Exit Loan Counseling
Students who accept Federal Direct Loans must complete loan counseling, which will explain your rights and responsibilities as a borrower.
- Entrance Counseling helps you to understand the terms and conditions of your loan as well as your rights and responsibilities. You must complete Entrance Counseling before the first disbursement of your Federal Direct Loan. To complete Entrance Loan Counseling online, click here.
- Exit Counseling is required when you graduate, leave school, or drop below half-time enrollment. It provides important information to prepare you for entering repayment.
Click here to learn more or to complete Entrance or Exit Counseling
There are two types of Federal Direct Loans:
- Subsidized Federal Direct Loan
A subsidized Federal Direct Loan is offered based on financial need and accrues no interest while the student is enrolled in school at least half-time, during the grace period or during periods of deferment. - Unsubsidized Federal Direct Loan
An unsubsidized Federal Direct Loan is not dependent upon need. Interest accrues from the time the loan is disbursed until final payment. The student has the option to make interest payments while in school and during the grace period.
If you accept federal student loans, you will be required to repay those loans with interest. It is important that you understand how interest is calculated and the fees associated with your loan. Both will impact the amount you will be required to repay. Click here to learn more about Federal Direct Loans.
To apply, complete your FAFSA. If eligible, you will automatically be offered Direct Loans as part of your financial aid package. You can view and accept the loan amount you would like to receive on the Financial Aid Dashboard at my.sc.edu. Select your campus to log into your secure account.
| Dependent Student (Parent(s) Not Denied a PLUS Loan) |
Independent Student (Dependent Student Whose Parent(s) Were Denied a PLUS Loan) |
|
| 1st Year 0 - 29 credit hours |
$5,500 (no more than $3500 subsidized) |
$9,500 (no more than $3500 subsidized) |
| 2nd Year 30 - 59 credit hours |
$6,500 (no more than $4500 subsidized) |
$10,500 (no more than $4500 subsidized) |
| 3rd Year and beyond 60+ credit hours |
$7,500 (no more than $5500 subsidized) |
$12,500 (no more than $5500 subsidized) |
There are limits to the amount of Federal Direct Loans that a student may borrow. Federal regulation also requires our office to reduce your loan amount if both of the following conditions are true:
- You are an undergraduate student who accepted a Federal Direct Loan and you will be enrolled for less than a full academic year.
- You will complete all degree requirements at the end of a semester or term
If our office reduced your Federal Direct Loan based on the above requirement, we will send you a revised aid letter.
Interest Rates
Interest rates for Direct Loans first disbursed on or after July 1, 2023, and before July 1, 2024, are listed as follows:
- Direct Subsidized Loans and Direct Unsubsidized Loans (Undergraduate): 5.50%
- Direct Unsubsidized Loans (Graduate or Professional): 7.05%
- Direct PLUS Loans (Parents and Graduate or Professional Students): 8.05%
Loan Fees
Most federal student loans have loan fees. These fees are a percentage of the total loan amount.
Federal Direct Subsidized Loans and Federal Direct Unsubsidized Loans
- First disbursement date on or after 10/1/2020 and before 10/1/2024: 1.057 percent
Federal Direct PLUS Loans
- First disbursement date on or after 10/1/2020 and before 10/1/2024: 4.228 percent
Click here for further information on Direct Loan fees and Interest rates.
Federal Direct PLUS Loans are available from the U.S. Department of Education to help parents pay for education expenses not covered by other financial aid. Parents can borrow up to the cost of attendance at the school your child will attend minus any other financial aid your child receives. The school determines the cost of attendance. Click here for more information about Parent PLUS Loans.
Interest is charged on a PLUS Loan from the date of the first disbursement is made until the loan is paid in full. Repayment begins 60 days after the final loan disbursement though parent borrowers may choose to defer payments until six months after the date the student ceases to be enrolled at least half time.
To receive a Parent PLUS Loan, you must:
- be the biological or adoptive parent of a dependent undergraduate student enrolled at least half-time at an eligible school;
- not have an adverse credit history; and,
- meet the general eligibility requirements for federal student aid.
A credit check will be performed during the application process. Borrowers with adverse credit history may still receive a parent PLUS loan through one of two options: seek a co-signer or successfully appeal the credit decision. If the borrower is unable to obtain a parent PLUS loan, the student may be eligible for additional unsubsidized loans.
How to Apply
- The student must complete a Free Application for Federal Student Aid (FAFSA).
- Parent borrowers apply online through the Direct PLUS Loan Application for parents, which includes a credit check. Click here to apply for a Federal PLUS Loan.
- If you are approved, sign a Direct PLUS Loan Master Promissory Note (MPN), agreeing to the terms of the loan.
Private educational loans can help bridge the gap between your cost of education and the financial aid offered to you through state or federal programs. If you are considering applying for a private loan, we encourage you to complete your FAFSA application first and then borrow only what you need. Click here for more information about the differences between federal and private loans.
How to Apply
- Determine how much you need to borrow.
- Research lenders and their loan products to determine which is best for you.
- Apply with the lender of your choice. This usually involves an online application and a credit check. You may also need a creditworthy co-signer.
- Submit any requested documentation. Follow-up with your lender to be sure they have everything they need.
Historical Lender List
The University of South Carolina and its representatives do not endorse any private lender. The lenders provided here are not recommendations but a list of lenders our students have used in the past three years. It is presented to aid your search. You are not limited to these lenders. You may choose any lender of your choice.
Disbursement
Most private loan disbursements are made via Electronic Funds Transfer (EFT) from your lender to the university. These funds will be applied to your university charges. Any remaining funds will be sent to you as a refund after all university fees have been paid in full.