Federal Direct loans are provided by the U.S. Department of Education at a fixed interest rate to help you pay for your undergraduate or graduate education. Because they are backed by the U.S. government, the interest rates are lower than private loans.
Unsubsidized loans:
- Loans for undergraduate and graduate students
- The student is responsible for all interest that accrues, even while they are in school
- You can make voluntary interest payments while in school, or defer interest payments until they enter repayment
We recommend paying the interest when it’s billed quarterly. Otherwise, unpaid interest will be added to the principal balance at the end of the grace period, making the loan more expensive.
Subsidized loans:
- Need-based loans for undergraduate students
- Interest is subsidized (paid) by the U.S. government, up to a set maximum amount, while the student is in school or during grace periods
- Interest doesn’t accrue if the student is enrolled at least half-time (six credits/semester)
- Example: You get a $5,500 Direct Loan, and the maximum amount that can be subsidized is $3,500. That means you’d have a $3,500 subsidized loan and a $2,000 unsubsidized loan.
How to Apply
There is no additional application process for students to be considered for Federal Direct Loans. Simply complete the FAFSA, and your financial aid award letter will indicate if you’ve received one of these loans, and for how much. You'll need to accept, decline, or revise (reduce) the loan through your Lesley Self-Service account.
Learn more about Federal Direct Loans, including annual and aggregate limits, interest rates, fees, and terms and conditions on the Federal Student Aid website.