Federal Direct Loan
The Federal Direct Loan program provides low interest, long term loans to eligible students through the U.S. Department of Education.
There are two types of Federal Direct Student Loans:
- Subsidized Federal Direct Loan
A Subsidized Federal Direct Loan is awarded based on financial need and accrues no interest while the student is enrolled in school at least half-time. Interest will accrue during the six-month grace period. - Unsubsidized Federal Direct Loan
An Unsubsidized Federal Direct Loan is not dependent upon need. Interest accrues from the time the loan is disbursed until final payment. The student has the option to make interest payments while in school and during the grace period.
Federal Direct Loan Annual Maximum Amounts
The amount a student can borrow is regulated by the Department of Education and is based on their year in school and dependency status, as determined by the FAFSA. There is also an overall limit based on the student’s cost of education.
|
Academic Class |
Dependent Student |
Independent Student |
|
Freshman (0 – 29 Earned Credits) |
$5,500 |
$9,500 |
|
Sophomore (30 – 59 Earned Credits) |
$6,500 |
$10,500 |
|
Junior (60 – 89 Earned Credits) |
$7,500 |
$12,500 |
|
Senior (90 or more Earned Credits) |
$7,500 |
$12,500 |
|
Graduate Student |
N/A |
$20,500 |
NOTE: For freshmen, only $3,500 may be subsidized; for sophomores $4,500; for juniors and seniors $5,500. Graduate students are not eligible for subsidized direct loans.
Mid-Year Grade Level Loan Adjustments
Student financial aid is packaged on an annual basis. If you change grade levels during the middle of the academic year, please contact us to request a review of your enrollment hours and financial aid package if you would like to be considered for additional loan funds based on your new grade level.
The Department of Education also limits the total debt you may have outstanding. The maximum amount of combined loans a student may have is as follows:
- $31,000 as a dependent undergraduate student, only $23,000 of which may be subsidized
- $57,500 as an independent undergraduate student, only $23,000 of which may be subsidized
- $138,500 as a graduate or professional student, only $65,500 of which may be subsidized (this includes debt incurred as an undergraduate)
Cancellation and Repayment Programs
Interest Rates
The interest rates for federal student loans are determined by federal law. If there are future changes to federal law that affect federal student loan interest rates, this information will be updated to reflect those changes.
The following fixed interest rates are for Direct Subsidized Loans, Direct Unsubsidized Loans, and Direct PLUS Loans first disbursed on or after July 1, 2021 and before July 1, 2022.
| Loan Type | Fixed Interest Rate |
| Direct Subsidized Loans and Direct Unsubsidized Loans for Undergraduate Students | 4.99% |
| Direct Unsubsidized Loans for Graduate and Professional Students | 6.54% |
| Direct PLUS Loans for Parents of Dependent Undergraduate Students and for Graduate or Professional Students | 7.54% |
Due to the Bipartisan Student Loan Certainty Act of 2013, Direct Loans interest rates will be tied to the financial market. Under the new interest rate structure, rates will be determined each June for new loans and will be fixed for the life of the loan. The rates are calculated using a 10-year Treasury Note Index plus an add-on amount for each loan program and include interest rate caps.
Learn more about how interest is calculated from the U.S Department of Education.
If you indicate on the FAFSA that you are interested in loans, we will automatically consider you for both Subsidized and Unsubsidized Federal Direct Loans, first awarding the maximum subsidized amount, then the maximum unsubsidized amount according to program limits and your eligibility. First-time borrowers must complete entrance loan counseling and sign a promissory note with the U.S. Department of Education online at https://studentaid.gov/understand-aid/types/loans prior to disbursement of funds.
Federal Direct Graduate PLUS Loan
Federal Direct Graduate PLUS Loans are available to graduate students to borrow their cost of attendance minus other financial aid. Graduate applicants are required to complete the FAFSA and must apply for their annual loan maximum eligibility under the Subsidized and Unsubsidized Federal Direct Loan before applying for a Direct Graduate PLUS Loan. Payments are not required while the student is enrolled on a half-time or greater basis. Applicants may be denied a Federal Direct PLUS Loan due to adverse credit history.
South Carolina Teachers Loan Program
Freshmen and sophomores may borrow up to $2,500 per year. Juniors, seniors, and graduate students may borrow up to $5,000 per year. The cumulative maximum amount is $20,000.
The loan is forgiven at the rate of 20% or $3,000, whichever is greater, for each year of full time teaching in a critical subject or critical geographic area within South Carolina. Teaching in both a critical subject and geographic area simultaneously increases the rate of forgiveness to 33 1/3% or $5,000, whichever is greater, for each year of full time teaching. The subject areas deemed critical at the time of application will be honored for forgiveness when teaching begins; critical geographic areas must be deemed critical at the time of employment. Failure to teach in a critical area will require repayment of the full amount borrowed plus accrued interest. The interest rate shall be the maximum interest rate on the Federal Direct Loan plus 2%.
Enrolled undergraduate students, including enrolled freshmen (2nd term of freshman year), must have a cumulative grade point average of at least 2.75 on a 4.0 scale and must have taken and passed the Praxis I Exam. (Praxis Core after 06/30/14). Students with a SAT score of 1100 or greater (1650 for 3-part exams taken on or after March 1, 2005) or an ACT score of 24 or greater are exempt from the Praxis requirement.
Applications are available in the Office of Financial Aid and on the website of South Carolina Student Loan.
Online Application for SC Teachers Loan
This application is for the SC Teachers Loan or the Career Changers Program (see below). Students may apply for both programs but can only receive funds from one program.
The annual priority deadline to submit the application is April 15. However, SC Student Loan will continue to accept applications until funding for the programs is exhausted.
South Carolina Career Changers Loan Program
Career changers are individuals who are changing careers to enter the teaching profession. They must meet the eligibility requirements for the South Carolina Teachers Loan Program except that the academic requirements are waived during the initial year of the teacher education program. To qualify as a Career Changer, the borrower must:
- have possessed a baccalaureate degree for at least three years. (This requirement is waived for individuals who are employed as instructional assistants in the South Carolina public school system.)
- have been employed for a minimum of three years.
Career Changers may borrow up to $15,000 per year and up to an aggregate maximum of $60,000.
