Federal Direct Student Loans
Federal Direct Loans are federally funded student loans with flexible repayment options. SubsidizedA Subsidized Federal Direct Student Loan is made on the basis of the borrower’s financial need (FAFSA) and other specific eligibility requirements. The federal government pays the interest on subsidized loans while the borrower is enrolled at least half time, during the grace period, or during periods of deferment. loans are need-based and eligibility is based on the student aid indexCollege financial aid offices use the Student Aid Index (SAI) to determine how much federal student aid you may be able to receive. The SAI is calculated using information from your FAFSA form. BU Financial Assistance uses information reported on the CSS Profile to determine eligibility for Boston University scholarships, not the SAI.. UnsubsidizedAn Unsubsidized Federal Direct Student Loan is made to a borrower meeting specific eligibility requirements, but not based on financial need (FAFSA). The borrower is responsible for paying all interest that accrues throughout the life of an unsubsidized loan. During in-school status, deferment, and forbearance periods, the borrower may choose to pay the interest charged on the loan or allow the interest to be capitalized. loans are not need-based.
All applicants must submit the FAFSAThe Free Application for Federal Student Aid (FAFSA) is used to determine eligibility for state and federal grants, scholarships, and loans. The FAFSA can be completed on the Federal Student Aid website.. First-time borrowers must also complete Entrance CounselingEntrance Counseling is a Federal Direct Loan requirement that ensures the borrower understands the terms and conditions of their loan and their rights and responsibilities. Federal loans cannot disburse until the borrower has completed it. The borrower can complete Entrance Counseling on the Federal Student Aid website. and a Master Promissory NoteThe Master Promissory Note (MPN) is a legal document in which the borrower promises to repay their loan(s) and any accrued interest and fees to the U.S. Department of Education. It also explains the terms and conditions of the loan(s). The Master Promissory Note can be completed on the Federal Student Aid website..
To request an adjustment to an existing Direct Loan, borrowers must complete and submit a Federal Direct Loan Request and Adjustment – Undergraduate form.