Federal Direct Student Loan Program

Federal Direct Student Loans are made available through the William D. Ford Federal Direct Loan Program. This program offers two types of Federal Direct Loans--subsidized and unsubsidized. These loans must be used for educational expenses during attendance at Middle Tennessee State University.

Direct Subsidized Loan
Direct Unsubsidized Loan
Federal Direct Loan Eligibility
Direct Loan Limits
The Application Process
Direct loan Disbursements
Direct Exit Interview

General Direct Loan Information

There is a grace period of 6 months after graduation or dropping below half-time attendance before repayment of the principal of the loan begins. Loan amounts are awarded based on grade level and cannot exceed the established cost of attendance for the school, including other aid received. Your awards may include both subsidized and unsubsidized loans.

Direct Subsidized Loan

Subsidized loans are awarded on the basis of financial need as determined by the Free Application for Federal Student Aid (FAFSA). With a subsidized loan, the federal government pays interest on the student loan durring:

• At least half-time enrollment in school,
• The six-month grace period after the student is no longer enrolled on at least a half-time basis

Direct Unsubsidized Loan

Student borrowers may qualify for this type of loan regardless of need or income. With unsubsidized loans, the student is responsible for interest that accres on the loan from the time the loan is disbursed until it is paid in full. You may choose to pay the interest as it accrues while you are enrolled, or you may defer the interest payments and allow them to accumulate (capitalize). If you choose to pay the interest as it accrues while you are enrolled, or you may defer the interest payments and allow them to accumulate (capitalize). If you choose to pay the interest as it accumulates, you will ultimately repay less. If you defer the interest, it will capitalize, which will result in an increase in student loan debt and monthly payments.

Federal Direct Loan Eligibility

In addition to the FAFSA, the following eligibility requirements must be met in order to qualify for a Federal Direct Student Loan:

• Half-time enrollment at an eligible institution, such as MTSU, in an eligible degree seeking program
• Be a U.S. citizen or eligible non-citizen
• Maintain Satisfactory Academic Progress (SAP)
• Not be in default on an educational loan or overpayment on an educational grant
• Not have Title IV student loans that exceed the annual or aggregate loan limits

Direct Loan Limits

Eligibility for all Federal Direct Loans will be based on cost of attendance, the estimated family contribution (EFC) as determined by FAFSA, other aid received, and the loan limits set by the U.S. Department of Education. Students may never qualify for more than the cost of attendance for the college or the annual loan limit. The charts below show the maximum amounts you may borrow.

Undergraduate Student Total School Year Loan Limits:

Dependent Undergraduates

	Freshman (0-29 hrs)	Sophomore (30-59 hrs)	Junior (60-89 hrs)	Senior (90 or more hrs)
Maximum Subsidized	$3,500	$4,500	$5,500	$5,500
Unsubsidized	$2,000	$2,000	$2,000	$2,000
Total	$5,500	$6,500	$7,500	$7,500

Federal Direct Maximum Aggregate Limits

Dependent Undergraduate	$31,000 (no more than $23,000 of which can be subsidized)
Independent Undergraduate	$57,500 (no more than $23,000 of which can be subsidized)

Additional Bachelor's Degree

Undergraduate students enrolled for an additional bachelor's degree may qualify for a Federal Direct Student Loan provided they have not reached their aggregate limit. Before a loan can be processed and/or disbursed, students must provide the Financial Aid Office with a signed copy of the upper division form which will detail the courses required for the additional degree.

Teacher's Certification

Students who have completed and undergraduate degree and are enrolled for the sole purpose of attaining teacher licensure may be eligible for Federal Direct Student Loans at the undergraduate level, provided they have not reached their aggregate limit. To receive aid, students must be enrolled at least half-time in required teacher certification coursework. Students must submit a copy of their Program of Study.

Graduate Student Total School Year Loan Limits

Federal Direct Loan Eligibility

	Graduate Yearly Loan Maximum
Unsubsidized	$20,500
Total	$20,500

Federal Direct Maximum Aggregate Limits

Graduate

$138,500 (no more than $65,500 of which can be subsidized)

Graduate Students Required to Take Undergraduate Prerequisites

Graduate students who are required to enroll in undergraduate courses in order to be accepted into a graduate program may qualify for Federal Direct Student Loans at the undergraduate level, provided they have not reached their aggregate undergraduate loan limits. If eligible, students may receive undergraduate loans for up to a maximum of 12 consecutive months while enrolled in these prerequisites. A letter from the academic department or graduation analyst or a copy of the candidacy form indicating which courses are required as prerequisites must be submitted to the Financial Aid Office before a loan can be processed and/or disbursed.

Graduate Students and Teacher Certification

Non-degree seeking graduate students who are working on a teacher licensure program may be eligible for Federal Direct Student Loans at the Undergraduate level, provided they have not reached their aggregate limit. Before a loan can be processed and/or disbursed, students must provide the Financial Aid Office with a copy of their Program of Study.

The Application Process

1. Complete the Free Application for Federal Student Aid (FAFSA) on the U.S.Department of Education's website.

2. Once your FAFSA has been processed, you will receive a valid Student Aid Report (SAR) which will summarize all of the information you provided on your FAFSA and provide you expected family contribution that is used in determining your eligibility for federal student aid. An electronic copy of your SAR will automatically be sent to the Office of Financial Aid of the school(s) listed on your FAFSA.

3. Based on the information obtained from your SAR, your Federal Direct Loan eligibility for fall/spring academic year may be listed on your student RaiderNet account. One semester only loans will require a Loan Request application sheet to be turned in to the MTSU Financial Aid Office.

4. Your may accept all or a part of the aid on the student RaiderNet account by indicating the type of loan you want (subsidized and/or unsubsidized), the loan amount requested, and the loan period.

   • Please remember that you will need to determine what your expenses and resources will be for the upcoming year before accepting or refusing a loan. Do not borrow more than you need! If you do not need a loan, click 'Decline' and then click "Accept Awards."

5. All first time borrowers at MTSU must complete an online Loan Entrance Counseling before receiving any loan funds.

6. Once you have completed the loan and completed online Loan Entrance Counseling (required for first time borrowers at MTSU), you may sign your Federal Direct Loan Master Promissory Note (MPN) online. If you have not done so under the Federal Direct Student Loan Program, you must electronically sign a new Master Promissory Note before loan funds can disburse onto your account.

   • You will receive a Notice of Guarantee and Disclosure Statement. This is your notice of loan approval, and it contains essential information about the terms and conditions of your loan. It also tells you the amount of your loan and an estimated date for the arrival of funds.

7. MTSU certifies your student loan request and submits the loan application to the government for approval after an accepted loan, MPN, and entrance counseling is on file.
   
   

8. The federal government generally disburses funds to MTSU within 4 days after receiving the completed Master Promissory Note if the semester has already started. Loan funds will be applied to your account and any charges will be paid with these proceeds. Check the current schedule book for the actual dates the money will be released to students. Students with direct deposits generally receive their funds early.
   
   

Direct Loan Exit Interviews

The federal government requires all students who stop attending school to complete an exit interview. This exit counseling will give you important information about repaying your loan. This counseling is for student who drop below half-time, withdraw, graduate from MTSU or do not return to their current university (even if they plan to transfer to another school).