How to Apply

To get a federal student loan, you must:

• Fill out the FAFSA® form (Free Application for Federal Student Aid) at studentaid.gov.

• After you send in your FAFSA, your school will tell you what types of federal loans you can get.

• You will need to accept the loan offer and sign a Master Promissory Note (MPN), which is your agreement to repay the loan.

Apply Here: FAFSA® Form

Types of Federal Student Loan Programs

• Direct Subsidized Loans
  For undergraduate students who show financial need.
  Interest: The government pays the interest while you're in school at least half-time, during the grace period, and during deferment periods.
  Interest Rate (2024-25): About 6.53% (fixed).

• Direct Unsubsidized Loans
  For undergraduate, graduate, and professional students, financial need is not required.
  Interest: You are responsible for all interest from the day the loan is made.
  Interest Rate (2024-25): About 6.53% (undergraduate) and 8.08% (graduate).

• Direct PLUS Loans
  For graduate students or parents of dependent undergraduate students. Good credit is usually needed.
  Interest Rate (2024-25): About 9.08%.

• Direct Consolidation Loans
  Combine multiple federal loans into one loan with one monthly payment. May help simplify repayment but won’t lower your interest rate.

Learn More: Types of Federal Student Loans

Repayment Options

You have several ways to repay your loans, and you can pick a plan that fits your income and goals:

• Standard Repayment Plan
  Fixed payments over 10 years.
  Good for paying off loans faster.

• Graduated Repayment Plan
  Payments start lower and increase every two years.
  Good if you expect your income to rise.
  

• Income-Driven Repayment Plans
  Payments are based on your income and family size.
  Good if you need smaller monthly payments.
  Includes plans like SAVE (Saving on a Valuable Education), PAYE (Pay As You Earn), and IBR (Income-Based Repayment).

• Public Service Loan Forgiveness (PSLF)
  If you work full-time for a nonprofit or government job, you may qualify for loan forgiveness after 10 years of payments.

Learn More: Repaying Your Loans

2026-27 Federal Student Loan Updates

Overview

Significant changes to federal student loan policies are coming in July 2026 under H.R. 1. These changes will impact how students borrow, repay, and manage their loans, with major implications for financial aid professionals and institutions.

Key Points

New Repayment Options Only

• Borrowers will choose between a 10–25 year Fixed Payment Plan or a new Income-Based Repayment plan (1–10% of income with forgiveness after 30 years). All current repayment plans like SAVE and REPAYE will be phased out.

Lifetime Loan Caps Introduced

• Borrowing will be capped at $50,000 for undergraduates, $100,000 for graduate students, and $150,000 for professional students. Parent PLUS loans remain available, but only after students reach these limits.

Revised Annual Loan Limits

• Annual borrowing for undergraduates will be tied to the median cost of attendance minus Pell Grants. Graduate students can borrow up to $20,500 per year; professional students up to $50,000.

Tighter Deferment and Forbearance Rules

• Borrowers can only use a maximum of 9 months of deferment or forbearance in any 24-month period.

School and Employer Accountability

• Graduate PLUS loans will be discontinued. Schools may lose federal loan access if graduates don’t meet income thresholds. Employers can now offer up to $5,250 per year in tax-free student loan repayment support.