Loan Programs
Federal Subsidized and Unsubsidized Direct Loan Program
The purpose of the Federal Direct Loan Program is to make low-interest, long-term loans to students to assist them in meeting their educational expenses.
First-time Federal Direct Loan borrowers are required to complete the Master Promissory Note (MPN)* and entrance loan counseling prior to disbursement of funds. Once a student has completed the MPN, the Note is valid for ten years so long as it is used within the first year after it is signed. Students must be enrolled at least half-time (six credit hours-undergraduate; four credit hours-graduate) in an eligible program to receive the funds from the Direct Loan Program. Students who are enrolled but are less than half time at the time of disbursement are not eligible to receive Direct Loan funds. Repayment generally begins six months after students graduate or drop below half-time enrollment in an eligible program. Generally, borrowers may take up to 10 years (or more) to repay their federal student loans.
Federal Direct Subsidized Loan
The Federal Direct Subsidized Loan is available to students who qualify based on their financial need*. Students who qualify for subsidized loan funds and are enrolled at least half-time are not required to make interest payments during in-school, deferment, and grace periods.
After graduation or cessation of half-time enrollment students are required to make payments on both the principle borrowed and interest as it accrues on their subsidized loans.
Federal Direct Unsubsidized Loan
The Federal Direct Unsubsidized Loan is available to students who do not qualify for the Federal Direct Subsidized Loan based on their financial need*.
The same application processes, terms and conditions apply to both the subsidized and unsubsidized loan programs, except that unsubsidized loans accrue interest during in-school and grace periods regardless of students' enrollment status. Borrowers are responsible for paying the interest on unsubsidized loans during all loan periods. Students may elect to capitalize the interest on their unsubsidized loans; however, this adds to the cost of borrowing. If they can afford to do so, students should make interest payments on their unsubsidized loans to keep the principle amount borrowed as low as possible. After graduation or cessation of half-time enrollment students are required to make payments on both the principle borrowed and interest as it accrues (as well as any accumulated capitalized interest) on their unsubsidized loans.
Dependent students whose parents are not approved for a Direct PLUS Loan due to adverse credit history, may be able to receive additional unsubsidized direct loan funds.
The following chart from https://studentaid.ed.gov/sa/types/loans/subsidized-unsubsidized shows the annual and aggregate limits for subsidized and unsubsidized loans. The student loans website is an excellent source of information about the federal loan programs.
| Year |
Dependent Students (except students whose parents are unable to obtain PLUS Loans) |
Independent Students (and dependent undergraduate students whose parents are unable to obtain PLUS Loans) |
| First-Year Undergraduate Annual Loan Limit |
$5,500—No more than $3,500 of this amount may be in subsidized loans. |
$9,500—No more than $3,500 of this amount may be in subsidized loans. |
| Second-Year Undergraduate Annual Loan Limit |
$6,500—No more than $4,500 of this amount may be in subsidized loans. |
$10,500—No more than $4,500 of this amount may be in subsidized loans. |
| Third-Year and Beyond Undergraduate Annual Loan Limit |
$7,500—No more than $5,500 of this amount may be in subsidized loans. |
$12,500—No more than $5,500 of this amount may be in subsidized loans. |
| Subsidized and Unsubsidized Aggregate Loan Limit |
$31,000—No more than $23,000 of this amount may be in subsidized loans. |
$57,500 for undergraduates—No more than $23,000 of this amount may be in subsidized loans. |
- The aggregate loan limits include any subsidized Federal loans and unsubsidized Federal loans from both the Federal Family Education Loan and Direct Loan programs.
- If a student's grade level changes during the academic year and this results in additional direct loan eligibility, the student must submit a written request to the FAO for the additional funds.
Graduate Student Loan Limits
Graduate students may borrow up to $20,500 in unsubsidized loans for the academic year. The aggregate loan limit for graduate students is $138,500 including undergrad borrowing.
Direct Loan eligibility during enrollment in certificate degree program
The College's certificate degree programs are designed to be completed in one year. Students who are enrolled in a certificate degree program are eligible to receive as a maximum the loan amount for freshman. Students are not eligible to exceed the annual freshman loan level during any academic year even when they enroll for more than one year to complete any certificate degree program.
Direct Loan eligibility during enrollment in an associate degree program
Most of the College's associate degree programs are designed to be completed in two years. Students who are enrolled in an associate degree program are eligible to receive as a maximum the loan amount for sophomores. Students are not eligible to exceed the annual sophomore loan level during any academic year even when they enroll for more than two years to complete any associate degree program.
Simultaneous enrollment
Students who are simultaneously enrolled in any combination of certificate, associate and/or baccalaureate degree programs are typically eligible to receive Direct Loan funds at the grade level for which they qualify in the program that has the longest length. For example, a student who is simultaneously enrolled in associate and baccalaureate degree programs and has reached the junior grade level in the baccalaureate program is likely eligible for a junior level loan, even though the associate is a two-year program.
Changes in type of program
Students who are enrolled in a baccalaureate degree program and change to an associate program may decrease the amount of their eligibility for Direct Loan funds. For example, if a student is enrolled in a baccalaureate degree program in the fall semester and has earned sufficient credits to place him at the junior grade level and changes to an associate program in the spring, his loan eligibility will decrease to the freshman or sophomore level depending on the student's academic progression in the associate program. In this scenario a portion of the student's loan for the spring semester must be cancelled and cannot be disbursed.
Direct Loan eligibility for enrollment in the nursing programs
Students who enter the College's nursing programs after previous enrollment at another institution should carefully monitor the aggregate amount that they have borrowed. Nursing students should also carefully project the amount that they anticipate they will borrow to complete their program to determine if they have sufficient remaining eligibility in Direct Loan funding. Nursing students can monitor their annual and aggregate amounts borrowed from the federal student loan programs through the National Student Loan Data System at studentaid.gov
If you are a nursing student who borrowed at one or more institutions prior to your enrollment at Presentation College, please visit the FAO for assistance in understanding your remaining loan eligibility.