Subsidized Direct Loans are interest free until graduation, withdrawal or less than half-time enrollment. Interest on Unsubsidized Direct Loans accrues immediately. Rates and fees are subject to change based on congressional action. The 21-22 academic year interest rate is 3.73%. An origination fee of 1.057% is charged on each loan and is automatically deducted from each disbursement. Interest rates for 22-23 academic year will be available in June.
The interest rate for 21-22 is 6.28%. Interest accrues during enrollment. An origination fee of 4.228% is charged on each loan and is automatically deducted from each disbursement. Interest rates for 2022-23 academic year will be available in June.
Private student loans are another commonly used financing option. Private loans are available from lenders who offer student loan programs and have differing interest rates, deferment and repayment options and other incentives. Eligibility is based on the credit history of student borrower and usually, a required co-signer. Interest rates are often variable and are tied to the credit scores of borrower/co-signer.
EMU’s lender list for private student loans is included at www.emu.edu/financial-aid/private-loans After carefully reviewing the features offered by a wide range of lenders, we have identified these lenders/programs because of their superior combination of savings, customer service, and loan processing reliability.
Many other private student loan programs exist. Please contact the Financial Assistance Office if you wish to consider a private loan not included on our list and instructions will be provided for that loan program.
A Federal Direct Loan is either subsidized or unsubsidized. FDSL funds originate from the federal government.
A subsidized loan is awarded based on financial need (Free Application for Federal Student Aid required to determine financial need.) The federal government pays interest on a subsidized loan while the student is enrolled. An unsubsidized loan is awarded when a student does not have financial need or when the maximum allowable subsidized award has been made and the student has remaining eligibility and uncovered costs. The borrower is charged interest from the beginning of the loan period and until the loan has been paid in full. If the student borrower allows interest to accrue, it will be capitalized – that is, the interest will be added to the principal amount of the loan and will increase the total amount of loan the student will need to repay.
The undergraduate annual loan limits for each grade level are:
01 (<24 credits) $5,500 dependent student, 9,500 independent student, (maximum sub amount $3,500)
02 (24–55 credits) $6,500 dependent student, $10,500 independent student, (maximum sub amount $4,500)
03–05 (>55 credits) $7,500 dependent student, $12,500 independent student, (maximum sub amount $5,500)
The maximum undergraduate aggregate Federal Direct Student Loan debt for a dependent student is $31,000 (maximum sub of $23,000) and for an independent student it is $57,500 (maximum sub of $23,000).
NOTE: Additional unsubsidized Federal Direct Student Loans may be available to a dependent student when a parent is denied a Federal Direct Parent PLUS Loan (see instructions on first page). The annual loan limit is $4,000 for freshmen and sophomores, and $5,000 for juniors and seniors. If a dependent student borrows additional unsubsidized FDSL funds because of a denied Fed Parent PLUS Loan(s), their undergraduate aggregate maximum for Fed Direct Student Loan borrowing is also $57,500.
The Federal Direct Parent PLUS Loan enables a parent with good credit history to borrow for the educational expenses of a dependent undergraduate student who is enrolled at least half-time. Currently the loan origination fee of 4.228% is automatically deducted from each disbursement of the loan. To include the fee in the requested amount, divide the desired net amount by .95772. For example, if $5,000 (net) is desired, divide by .95772 and make a request of $5,221.
The interest rate on a PLUS Loan is currently a fixed rate of 6.28%. Interest is assessed from the begin date of the loan period and continues until the loan is paid in full. Rates and fees are subject to change based on congressional action. Interest rates for the 22-23 academic year will be available in June.
Repayment of the total amount borrowed (including the origination fee) begins 60 days after the second disbursement is made. Parents may choose to defer repayment until six months after the date the student for whom the loan is borrowed ceases to be enrolled at least half time.