Federal Direct Loans

Subsidized
Unsubsidized
Loan Limits
How to Apply

Federal Direct Loans offer you a low interest rate. It offers a six-month grace period after enrollment ceases or drops below half-time status. The amount of Federal Direct Loan you may borrow is determined by your grade level in school and by limits set by the Department of Education.  For more information about Federal Direct Loans, please refer to http://www.direct.ed.gov/student.html.

There are two types of Federal Direct Loans:

Federal Direct Subsidized:

These are based on financial need, which is determined by completing the FAFSA.   

        Loans borrowed during the 2013-14 academic year

  • The interest rate is fixed at 3.86%. (Note that this is a change due to recent congressional action.)
  • Loans are interest free only while the student is enrolled in school.
  • Loans that have a first disbursement before December 1, 2013 have a 1.051% federal default fee.  Loans that have a first disbursement December 1 or later have a 1.072% fee. 

Federal Direct Unsubsidized:

These loans are not based on financial need; interest starts accruing once the loan disburses. You may elect to pay the interest as it accrues or defer it until you enter repayment.

        Loans borrowed during the 2013-14 academic year

  • The interest rate is fixed at 5.41%.
  • Loans that have a first disbursement before December 1, 2013 have a 1.051% federal default fee.  Loans that have a first disbursement December 1 or later have a 1.072% fee. 

Susidized and Unsubsidized

Annual Loan Limits

 


Dependent Undergraduates


Independent Undergraduates*

Freshmen $5,500—No more than $3,500 of this amount may be in subsidized loans. $9,500—No more than $3,500 of this amount may be in subsidized loans.
Sophomores $6,500—No more than $4,500 of this amount may be in subsidized loans. $10,500—No more than $4,500 of this amount may be in subsidized loans.
Juniors & Seniors $7,500—No more than $5,500 of this amount may be in subsidized loans. $12,500—No more than $5,500 of this amount may be in subsidized loans.

*This category also includes those undergraduates whose parents are unable to borrow a PLUS.

Lifelong Loan Limits

Dependent undergraduate students may borrow up to $31,000, of which no more than $23,000 may be subsidized.

Independent undergraduate students may borrow up to $57,500, of which no more than $23,000 may be subsidized.

        To be eligible for a Federal Direct  loan, students must:

  • Submit the FAFSA for each academic year she wishes to obtain a Federal Direct loan
  • Be a U.S. citizen or an eligible non-citizen
  • Be enrolled at least half-time as an undergraduate or graduate student
  • Have no prior outstanding student loan in default and not owe a repayment on any federal aid
  • Complete a Federal Direct loan application and Master Promissory Note (MPN)
  • Complete entrance counseling prior to receiving the first Federal Direct loan at Saint Mary's College
  • Be meeting Saint Mary's Financial Aid Standards of Satisfactory Academic Progress

To apply for a 2013-2014 Federal Direct Loan:

If you are a new borrower at Saint Mary's College, please complete both steps listed below.  This includes transfer students who may have borrowed Federal Direct loan funds or Stafford loan funds at another institution.

  1. Before you begin, please make sure you are using a supported browser.  MS Explorer, Firefox, and Safari are supported browsers.
  2. Log onto PRISM and accept the loans that were offered to you as part of your financial aid award letter (accept only those loans you wish to borrow).
  3. Complete the federally required Entrance Counseling
    • Click the "Sign In" button.  You will need your PIN to complete this.  It is the same PIN used to complete your FAFSA.
    • Once you are signed in, select "Complete Entrance Counseling" from the menu on the left-hand side of the screen.  Please read the information and answer the questions as they appear.
    • When you are asked to select a state and a school, select "Indiana" under School State and "ST MARYS COLLEGE" under School Name. 
    • Read the information presented to you.  You will be quizzed on the information and must successfully answer 12 of 15 questions to pass the entrance counseling quiz.  If you fail the quiz three consecutive times, you will need to wait 48 hours and try again.  Some browsers may allow you to clear your temporary internet files/cookies and try again without waiting 48 hours.
  4. Complete your Master Promissory Note (MPN).
    • On the left-hand side of the page, select "Complete MPN" and then select "Subsidized/Unsubsidized" as the loan type.
    • Continue following the steps as directed.  When you are asked to select a state and a school, select "Indiana" under School State and "ST MARYS COLLEGE" under School Name.

If you experience technical difficulties with either of these processes, please call COD Applicant Services at 800-557-7394.

If you have previously borrowed Federal Direct loan funds through Saint Mary's College:

  1. Log onto PRISM and accept the loans that were offered to you as part of your financial aid award letter (accept only those loans you wish to borrow).