Federal Direct Stafford Loan
The Ohio State University offers Federal Direct Stafford/Ford Loans (Federal Direct Subsidized and Unsubsidized Loans) as a participant in the William D. Ford Federal Direct Loan Program. When you borrow a Federal Direct Loan at Ohio State, you will borrow from the federal government by receiving funds directly through Ohio State. The Ohio State University does not participate in the Federal Family Education Loan (FFEL) program.
Under the Federal Direct Loan Program, you will have several different options for repayment, so you can select the repayment plan that is best for your financial circumstances. For more information regarding repayment options, see the Student Guide.
Federal Direct SUBSIDIZED Loan
The Federal Direct Subsidized Loan (Sub) is a need-based federal loan awarded only to students who demonstrate financial need. Undergraduate, graduate, and professional students who have unmet financial need can be considered for this loan up to the amount of the students' borrowing limit. Borrowers must be U.S. citizens or eligible non-citizens enrolled at least half time and maintaining Satisfactory Academic Progress for Financial Aid Eligibility. In addition, borrowers must meet all other requirements listed as Student Rights and Responsibilities.
Federal Direct UNSUBSIDIZED Loan
The Federal Direct Unsubsidized Loan (Unsub) is a non-need based federal loan that cannot exceed the educational cost of attendance minus other financial aid. Undergraduate, graduate, and professional students who are not eligible for any Sub Loan or are eligible for only a portion of the annual loan limit for the Sub Loan may apply for the Unsub. Borrowers must be U.S. citizens or eligible non-citizens enrolled at least half time and maintaining Satisfactory Academic Progress for Financial Aid Eligibility. In addition, borrowers must meet all other requirements listed as Student Rights and Responsibilities.
Additional Unsubsidized Loan for Health Professions Students
Additional unsubsidized amounts are available for students enrolled in the health professions colleges. These include the Colleges of Dentistry, Medicine, Optometry, Pharmacy and Veterinary Medicine. Students in these professional programs may receive up to a maximum of $20,000, not to exceed cost of attendance.
The aggregate subsidized and unsubsidized loan amount (regular and additional) is $224,000.
Application Process
File the FAFSA or Renewal FAFSA to be considered for a Federal Direct Subsidized or Unsubsidized Loan.
Borrowing Limits
Borrowing limits depend on class rank and academic level, and vary for undergraduates and graduate and professional students. Special rules apply to students taking coursework through the Office of Continuing Education (CEd) and graduate nondegree coursework.
The Office of Student Financial Aid (OSFA) uses the National Student Loan Database Service (NSLDS). Consequently, your loan award will reflect any loans borrowed at Ohio State and/or at previously attended institutions. Refer to your Student Aid Report (SAR) for your loan aggregates.
Federal Direct Loan Annual Borrowing Limits for Loans Disbursed July 1, 2008 or Later |
|---|
Class Rank
(credit hours) |
Dependent Maximum/Independent Subsidized Maximum |
Additional Unsubsidized Eligibility for Dependent Students (except students whose parents cannot borrow a PLUS loan) |
Additional Unsubsidized Eligibility
for Independent Students (and dependent students whose parents cannot borrow a PLUS loan) |
|---|
First-year undergraduate (0-44) |
$3,500 |
$2,000 |
$6,000 |
Second-year undergraduate (45-89) |
$4,500 |
$2,000 |
$6,000 |
Third, fourth, fifth-year undergraduate (90+) |
$5,500 |
$2,000 |
$7,000 |
Graduate or graduate-professional (all levels) |
$8,500 |
N/A |
$12,000 |
Continuing Education (CEd) working toward an undergraduate degree program
(over one consecutive 12-month period only) (all levels) |
$2,625 |
0 |
$4,000 |
Continuing Education (CEd) working toward a graduate or graduate-professional degree program
(over one consecutive 12-month period only) (all levels) |
$5,500 |
0 |
$7,000 |
Graduate non-degree-seeking students working toward a graduate or graduate-professional degree program
(over one consecutive 12-month period only) (all levels) |
$5,500 |
0 |
$7,000 |
Non-degree-seeking students with prior bachelor's degrees taking courses for teacher certification (all levels) |
$5,500 |
0 |
$7,000 |
Federal Direct Loan Aggregate Borrowing Limits |
|---|
Student Status |
Subsidized Loans |
Total Subsidized and Unsubsidized Loans |
|---|
Dependent Undergraduate (including CEd and graduate nondegree) |
$23,000 |
$31,000 |
Independent Undergraduate (including CEd and graduate nondegree) |
$23,000 |
$57,500 |
Graduate or Law Students |
$65,500 |
$138,500 |
Health Professional Students |
$65,500 |
$224,000 |
Repayment Terms
Recent regulation changes have created interest rate reductions on Federal Direct Subsidized Loans made to undergraduate students over a four-year period beginning July 1, 2008. The applicable interest rates for loans made to undergraduate students during this period are as follows:
Direct Subsidized Loan Interest Rates for Undergraduates |
First disbursement of loan
on or after. . . but prior to |
Interest rate
on the unpaid balance |
| July 1, 2008 - July 1, 2009 |
6.0 % |
| July 1, 2009 - July 1, 2010 |
5.6 % |
| July 1, 2010 - July 1, 2011 |
4.5 % |
| July 1, 2011 - July 1, 2012 |
3.4 % |
Direct Subsidized Loan Interest Rates for
Graduate & Professional Students |
| Loans disbursed July 1, 2006 or later |
6.8% |
Direct Unsubsidized Loan Interest Rates for
All Students |
| Loans disbursed July 1, 2006 or later |
6.8% |
The interest rate for Federal Direct Subsidized Loans for graduate and professional students and all Unsubsidized Loans is fixed at 6.8% for loans first disbursed on or after July 1, 2006. Borrowers will be charged an origination fee of two percent (2%), minus a rebate of approximately 1.5%, which will be deducted from the loan before disbursement is made.
For Unsubsidized Loans (Unsub), interest must be paid while the student is in school at least half-time. If the student chooses not to pay the interest, it will accrue and be capitalized (added on to the principal at the time of repayment).
Repayment of the principal balance begins six months after graduation, withdrawal, or less-than-half-time enrollment. Students may be allowed up to thirty years for repayment in certain circumstances, however, repayment is usually based upon a ten-year plan.
Examples of Typical Standard Federal Direct Loan Repayments at 5.6% Interest |
|---|
Principal
to Repay |
Number of
Payments |
Monthly Payments |
Total Interest Charge |
Total
Repayment |
|---|
$3,500 |
84
1 |
$50.00
$47.54 |
$747.54 |
$4,247.54 |
$5,000 |
119
1 |
$54.51
$54.71 |
$1,541.40 |
$6,541.40 |
$7,500 |
119
1 |
$81.77
$81.26 |
$2,311.89 |
$9,811.89 |
$10,500 |
119
1 |
$114.47
$115.05 |
$3,236.98 |
$13,736.98 |
$15,000 |
119
1 |
$163.53
$164.12 |
$4,624.19 |
$19,624.19 |
|
For more information on borrowing limits, repayment plans, and interest rates, see the U.S. Department of Education's William D. Ford Federal Direct Loan Program page at www.ed.gov/directloan/about.html.
Loan Cancellation
You have the right to cancel all or part of your federal loan disbursement for each quarter. Submit a written request to the Office of Student Financial Aid (OSFA) within 14 days from the date you receive official notification that loan funds have credited to your university account, or before the first day of classes, whichever occurs last. Official notification will be sent to you no earlier than 10 days before the start of each term. For Parent PLUS Loans, official notification occurs with the posting of the loan to your student's university account.
Your written request to cancel a Stafford, Perkins, or Grad PLUS loan may be submitted by e-mail from your osu.edu e-mail account or as a handwritten, typed, or printed statement bearing an original signature submitted by mail, in person, or by fax. To cancel a parent PLUS loan, the parent borrower may submit a handwritten, typed, or printed statement bearing an original signature by mail, in person, or by fax (no e-mail can be accepted).
Cancellation Request Received within the 14-day Period or Before the First Day of Classes, Whichever Occurs Last:
No interest will be charged and loan fees will be returned to the loan holder. OSFA must receive the cancellation request in writing from the borrower (you for student loans; parent borrower for parent loans). To cancel the loan disbursement, contact our office.
Cancelling your loan disbursement could cause a balance to be due on your university account which you will be responsible for paying. This is more likely to be true if excess funds (credit balance) have already been distributed via a check or a direct deposit to a bank account or your BuckID.
Repayment AFTER the Designated Time Period:
You cannot cancel your loan disbursement if the designated time period described above has already passed. Instead, you can repay the loan disbursement directly by contacting the loan holder (Direct Loan Servicer for Federal Direct Loans; Student Loan Services for Federal Perkins Loan). The borrower (you for student loans; the parent borrower for parent loans) will be responsible for any interest that may have accrued and/or any loan fees.
Cancelling Future Loan Disbursements:
You (the borrower) must submit in writing your request to cancel future loan disbursements by contacting our office prior to 10 days before the start of classes for the next term(s). For your convenience, the Report Your Changes form is available for this purpose. Once the loan has been disbursed for the next term(s), then you must follow the procedures described above.
What do I need to do to receive my award?
To receive this award, you must:
- Activate your Ohio State Internet Username. If you have already done so, skip to Step 2.
- If you are new to Ohio State, you will be notified by the university when your Ohio State Internet Username is assigned and ready for activation. To activate your Internet Username, go to acctmgt.service.ohio-state.edu.
- If you experience difficulties with the activation process, call the Office of Information Technology help desk at 614-688-HELP(4357).
- You will be notified by e-mail or U.S. mail of your award package, therefore, it is vital that you read your e-mail on a daily basis.
- Decline, accept, or accept less than the full amount of this loan online. Sign in by using your Ohio State Internet Username and password.
- If you accept all or part of your loan and a Master Promissory Note (MPN) is required, you will be instructed to go to the electronic MPN web site to complete one. You will need to have your federal Personal Identification Number (PIN), available at pin.ed.gov.
- First-time borrowers must complete online entrance counseling at www.dl.ed.gov. You will need to have your federal Personal Identification Number (PIN), available at pin.ed.gov.
What is online Exit Counseling?
Federal Direct Loan borrowers who are leaving school, dropping below half-time enrollment, or graduating must complete exit counseling. Exit counseling provides you with important information about repayment and your rights and responsibilities. Failure to complete an exit counseling session will result in the following:
- Financial aid funds will be withheld upon your return to Ohio State.
- Official transcripts will be withheld.
If you have received an e-mail instructing you to complete exit counseling, go to the Direct Loan Servicing Center's exit counseling site and click on "Take the Exit Counseling session" to begin. You will need your PIN.
Your session will be recorded once you have completed the questionnaire and finished steps 1, 2, and 3. You may sign the agreement online. Your session is then recorded, and Ohio State will have your information the next business day. Alternatively, you may print your borrower rights and responsibilities pages to sign, date, and submit to OSFA.
How will my loan be issued?
According to federal regulations, your Federal Direct Loan award must be issued in multiple disbursements during the academic year. If you plan to enroll for four terms, your loan award will be issued in four equal disbursements (you will receive one-fourth of your loan award each term). If you plan to enroll for three terms, your loan will be issued in three equal disbursements (you will receive one-third of your loan award each term). If you plan to enroll for two terms, your loan will be issued in two equal disbursements (one disbursement per term). If you plan to enroll for only one term, your loan award will be issued to you in one disbursement.
Please Note: Per federal regulations, if you are an undergraduate student who will graduate spring quarter 2009 or earlier, and you enroll fewer than three terms, you will be limited to one-third of the total maximum Federal Direct Subsidized or Unsubsidized Loan per term. For example, if you are enrolling autumn quarter 2008 and winter quarter 2009 and you are graduating at the end of winter quarter 2009, you will be eligible for no more than two-thirds of your total $5,500 annual maximum in Federal Direct Subsidized or Unsubsidized Loan. If you attend autumn quarter 2008, do not attend winter quarter 2009, and return spring quarter 2009, you will be eligible for only one-third of the total $5,500 annual maximum each term during autumn quarter and spring quarter. Therefore, your total loan eligibility for the year will total two-thirds of the $5,500 annual maximum.
What will happen if I change class rank during the academic year?
If you change class rank during the academic year, you may be eligible for additional Federal Direct Subsidized or Unsubsidized Loan funds. If you change rank from a freshman to a sophomore, from a sophomore to a junior, or from an undergraduate to a graduate status during the academic year, and you wish to be considered for additional loan funds, please contact our office to initiate the process.
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