Skip to main content

Federal Direct Loans

Federal Direct Loans are available to all eligible students who complete a Free Application for Federal Student Aid (FAFSA) and are enrolled in school on at least a half-time basis. The Office of Financial Aid Services will offer the type and amount of Federal Direct Loan that you are eligible for when we prepare your Financial Aid Offer. Below you will find important details about the Federal Direct Loan program.

On this Page


Subsidized vs. Unsubsidized

Subsidized

Subsidized eligibility is based on financial need. The government pays any interest that accrues on a Subsidized Federal Direct Loan while the student is enrolled in school at least half-time and through the grace period. 

A Subsidized Federal Direct Loan is only available for students enrolled in undergraduate degree programs or the post-baccalaureate teacher’s certificate program. Students enrolled in graduate degree programs do not qualify for Subsidized Federal Direct Loans.

Unsubsidized

All students, regardless of degree or certificate program enrollment and financial need, are eligible for Unsubsidized Direct Loans. The government will not pay any interest that accrues on an Unsubsidized Federal Direct Loan.


Interest Rates and& Fees

The interest rates for Federal Direct Loans differ depending upon degree or certificate program enrollment. The interest rate assigned is fixed, and interest accrual will begin upon disbursement; which takes place after Moravian’s Add/Drop period each semester.

Note: Federal Direct Loans have an up-front fee, referred to as an “origination fee."

Program Type Federal Direct Loan Type Fixed Interest Rate Origination Fee
Undergraduate Degree & Post-Baccalaureate Teacher’s Certificate Programs Subsidized/Unsubsidized Federal Direct Loans 4.99% for loans disbursed July 1, 2022 - June 30, 2023 1.057%  for loans disbursed on or after October 1, 2022 and before October 1, 2023
Graduate Degree Programs Unsubsidized Federal Direct Loans 6.54% for loans disbursed July 1, 2022 - June 30, 2023 1.057%  for loans disbursed on or after October 1, 2022 and before October 1, 2023

Program Type Federal Direct Loan Type Fixed Interest Rate Origination Fee
Undergraduate Degree & Post-Baccalaureate Teacher’s Certificate Programs Subsidized/Unsubsidized Federal Direct Loans 5.50% for loans disbursed July 1, 2023 - June 30, 2024 1.057%  for loans disbursed on or after October 1, 2023 and before October 1, 2024
Graduate Degree Programs Unsubsidized Federal Direct Loans 7.05% for loans disbursed July 1, 2023 - June 30, 2024 1.057%  for loans disbursed on or after October 1, 2023 and before October 1, 2024

Annual and Aggregate Loan Limits

Year in School 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 per year-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.

Graduate or Professional Student Annual Loan Limit $20,500 (unsubsidized only)
Subsidized and Unsubsidized Aggregate Loan Limit $138,500 for graduate or professional students-No more than $65,500 of this amount may be in subsidized loans. The graduate aggregate limit includes all federal loans received for undergraduate study.

Accepting Your Federal Direct Loans

For First Time Loan Borrowers

On your Financial Aid Offer and the AMOS Financial Aid Portal, your Federal Direct Loans will have an “Accepted” status. If you wish to formally accept your Federal Direct Loans, as a first-time borrower, you must complete Entrance Counseling and a Master Promissory Note (MPN) at studentaid.gov. You will need to know your student FSA ID to log in to this site.

To complete your Entrance Counseling and MPN:

  1. Go to studentaid.gov
  2. Log in with your student FSA ID
  3. Hover over "Loans and Grants”
  4. Select Loan Entrance Counseling
    1. If you are an Undergraduate student, select “Start” next to “I am an Undergraduate Student” to begin
    2. If you are a Graduate student, select “Start” next to “I am a Graduate or Professional Student” to begin
  5. Once your Loan Entrance Counseling is complete, return to the "Loans and Grants" section and select Master Promissory Note.
    1. If you are an Undergraduate student, select “Start” next to “I’m an Undergraduate Student” to begin
    2. If you are a Graduate student, select “Start” next to “I’m a Graduate or Professional Student” to begin

Note: Transfer students who have borrowed through the Direct Loan program at a previous institution do not need to complete a new MPN or Entrance Counseling as long as the loan requirement is not expired. 

For Returning Borrowers

On your Financial Aid Offer and AMOS Financial Aid Portal, your Federal Direct Loans will have a “Pending” status. If you wish to formally accept your Federal Direct Loans, as a returning borrower, you must sign an Annual Student Loan Acknowledgement.

To complete your Annual Student Loan Acknowledgement:

  1. Go to studentaid.gov
  2. Log in with your student FSA ID
  3. Hover over "Loans and Grants”
  4. Select Annual Student Loan Acknowledgement 
    1. If you are an Undergraduate student, select “Start” next to “I’m an Undergraduate Student” to begin
    2. If you are a Graduate student, select “Start” next to “I’m a Graduate or Professional Student” to begin

How to Decline a Federal Direct Loan

If you do not wish to borrow a Federal Direct Loan offered to you, you can complete a Loan Adjustment Form and submit to the Office of Financial Aid Services. Upon receipt of your completed Loan Adjustment Form, Financial Aid Services will decline the loan on your behalf and waive the aforementioned loan requirements. 


Repayment

Federal Direct Loans for students are in deferment while the student is enrolled in school on at least a half-time basis. This means that you are not required to make payments on your Federal Direct Loans while you are enrolled in school until you begin repayment.

Repayment begins once the 6 month grace period ends after you are no longer enrolled in school on at least a half-time basis. The standard repayment plan Federal Direct Loans borrowers are placed on spans 10 years; however there are a variety of other flexible repayment plan options available for federal student loan borrowers to explore. 

Learn about repayment plan options>

Estimate your student loan repayment options with the FSA’s Loan Simulator>


Miscellaneous Information

  • In response to the COVID-19 emergency relief period, the interest rate on all Direct Loans has been temporarily set at 0% until at least December 31, 2022. Once the COVID-19 emergency relief period ends, the rates as described in this announcement will be in effect for loans first disbursed on or after July 1, 2022.
  • The standard 10-year repayment period begins 6 months after graduation or the student ceases to be enrolled at least half-time.
  • For students who are new borrowers on or after July 1, 2013, the period during which students may borrow Direct Subsidized Loans and the period during which the in-school interest subsidy may be provided, will be limited to 150% of the published length of their educational program.
  • Any student is able to view their loan history by logging on to studentaid.gov