Federal Direct Loans

The Federal Direct Loan is a low-interest student loan with flexible repayment options. These loans can be either subsidized or unsubsidized.

Subsidized loans are offered to students who are eligible for need-based financial assistance. No interest is charged on these loans until you graduate, withdraw or are enrolled less than half-time. Interest accrues following a six-month grace period.

Unsubsidized loans are available to those who do not qualify for need-based financial assistance. Unlike subsidized loans, interest accrues on these loans while students are still in school. You have the option to pay the interest as you attend school or to wait for the repayment period to begin.

To be eligible for a Federal Direct Loan, you must be a U.S. citizen or permanent resident, not have previous defaults on a federal loan, be enrolled or plan to enroll at least half-time, and maintain satisfactory academic progress. For more information, visit the U.S. Department of Education’s website.

How to apply

There are four required steps to apply for a Federal Direct Loan. Make sure your Free Application for Federal Student Aid (FAFSA) is sent to Furman. Furman’s Title IV code is 003434.

One Big Beautiful Bill Act (OBBBA)

The One Big Beautiful Bill Act (OBBBA) was signed into law on July 4,2025. recent federal changes under the One Big Beautiful Bill Act (OBBBA) of 2025 introduced new limits on federal student and parent loans beginning July 1, 2026.

-Graduate PLUS loans are no longer available for new borrowers starting July 1, 2026.

-Parent PLUS Loans for dependent students:

  • Annual Limit: $20,000 per student (Legacy exception: Parents who borrowed a PLUS Loan before July 1, 2026 may qualify for a temporary exception to borrow up to the full cost of attendance. This applies only if the student remains continuously enrolled in the same program and school. The exception is limited (generally up to 3 years or until program completion), after which new federal loan limits apply. The legacy exception is temporary and generally lasts up to 3 academic years OR until the student finishes the program (whichever comes first)
  • Lifetime Limit: $65,000 per student

Prior to July 1, 2026, parents could borrow up to the full cost of attendance. New federal regulations now cap borrowing amounts.

 

ANNUAL LOAN LIMITS
Year Dependent Students Independent Students (or Dependent undergraduate students whose parents are denied PLUS Loan)
First-Year Undergraduate
Dependent Students
$3,500 subsidized, $2,000 unsubsidized. Combined total: $5,500
Independent Students (or Dependent undergraduate students whose parents are denied PLUS Loan)
$3,500 subsidized, $6,000 unsubsidized. Combined total: $9,500
Second-Year Undergraduate
Dependent Students
$4,500 subsidized, $2,000 unsubsidized. Combined total: $6,500
Independent Students (or Dependent undergraduate students whose parents are denied PLUS Loan)
$4,500 subsidized, $6,000 unsubsidized. Combined total: $10,500
Graduate
Dependent Students
N/A All graduate and professional students are considered independent.
Independent Students (or Dependent undergraduate students whose parents are denied PLUS Loan)
$20,500 unsubsidized only (Ineligible for subsidized)
INTEREST RATES
Loan Type Disbursal Date Interest Rate
Direct Subsidized Loans and Direct Unsubsidized Loans for Undergraduate Students
Disbursal Date
On or after July 1, 2025 and before July 1, 2026
Interest Rate
6.39%
Direct Unsubsidized Loans for Graduate and Professional Students
Disbursal Date
On or after July 1, 2025 and before July 1, 2026
Interest Rate
7.94%
Direct PLUS Loans for Parents of Dependent Undergraduate Students and for Graduate or Professional Students
Disbursal Date
On or after July 1, 2025 and before July 1, 2026
Interest Rate
8.94%

All interest rates shown in the chart above are fixed rates. A fixed rate will not change for the life of the loan.

Origination Fee

*Subject to change Oct 1

Loan Type Disbursal Date Loan Fee Percent
Direct PLUS Loans (Parent and Graduate or Professional Students)
Disbursal Date
On or after October 1, 2020 and before October 1, 2026
Loan Fee Percent
4.228%
Direct Subsidized Loans and Direct Unsubsidized Loans
Disbursal Date
On or after October 1, 2020 and before October 1, 2026
Loan Fee Percent
1.057%

An origination fee is a percentage of your loan amount charged by the lender for the processing of your loan. Federal student loans have an origination fee; therefore, the amount you may receive as a disbursement may be slightly lower than the amount you accept.

Although some private loans do not have origination fees, federal loans generally have a lower interest rate and are less costly overall.

Aggregate Loan Limits
Subsidized Unsubsidized Combined
Undergraduate (Dependent)
Subsidized
$23,000
Unsubsidized
$8,000
Combined
$31,000
Undergraduate (Independent or Dependent with PLUS Loan Denial)
Subsidized
$23,000
Unsubsidized
$34,500
Combined
$57,500
Graduate
Subsidized
$65,500**
Unsubsidized
$73,000
Combined
$138,500

**Includes undergraduate Stafford/Direct Loans.