Direct Subsidized Loans are loans made to eligible undergraduate students who demonstrate financial need to help meet financial need after other resources are subtracted up to your annual loan limit, whichever is lower. A subsidized loan is one in which the Federal Government pays on the interest while student is enrolled at least half time. Six months after the student graduates or ceases to be enrolled at least half-time, interest begins to accrue and continues to do so until the time the loan is paid in full.
Students borrowing a Direct Subsidized Loan are subject to a time limitation not to exceed 150% of the length of the borrower’s educational program. For example, a student enrolled in the ASN Program, which is a 2-year program, has only a three-year maximum eligibility for Direct Subsidized Loan. Direct Subsidized Loans borrowed for a previous program counts toward the current program limit.
Students must be enrolled at least half-time to receive a Federal Direct Loan.