Federal Direct Loans are offered by the U.S. Department of Education through the Federal Direct Student Loan Program (FDLP). These loans are available to college students to supplement personal and family resources, scholarships, grants, and work-study. You will be notified by the Financial Aid Office of the amount and loan type(s) you are eligible to receive.
Types of Direct Loans
Subsidized Direct Loans are awarded on the basis of financial need. You will not be charged interest before you begin repayment or during authorized periods of deferment.
Unsubsidized Direct Loans are NOT awarded on the basis of need. You will be charged interest from the time the loan is disbursed until it is repaid in full. If you allow the interest to accrue (accumulate) while you are in school or during other periods of nonpayment, it will be capitalized. This means that interest will be added to the principal amount of your loan, and additional interest will be based on that higher amount.
Additional Unsubsidized Direct Loans are NOT awarded on the basis of need. If you are considered a dependent student for financial aid purposes, you may be eligible for up to $2,000 per school year. If you are considered an independent student for financial aid purposes, you may be eligible for up to $6,000 per school year. An independent student must meet one of the following criteria: turn 24 by December of the school year; be married, be a veteran of the U.S. Armed Forces; have children or dependents that receive more than one half of their support from you; be an orphan or ward of the court; were in foster care after the age of 13; be an emancipated minor; be a minor in legal guardianship; or been verified as an unaccompanied youth who are homeless children or youth or are at risk of homelessness.
The maximum base loan amount awarded is determined by the number of credits a student has earned. A first year student who has earned 0 - 29.9 program credits may be eligible for a maximum loan amount of $3500. A second year student who has earned more than 29.9 program credits may be eligible for a maximum loan amount of $4500. The number of credits a student has earned is determined at the time we certify the loan.
An enrollment status of half-time is required for student loans. If you drop below half-time or terminate your enrollment, you may not be eligible to receive your loan disbursement.
An origination fee of 1.05% is deducted directly from the gross amount of the loan by the Department of Education. The Department of Education provides a chart of current and previous Direct Loan Interest Rates. Subsidized and Unsubsidized loans for which the first disbursement is made on or after July 1, 2013, have a 6.8% fixed interest rate.
Loans must be certified by CVTC prior to the end of the student's enrollment period for the academic year. If the end of your enrollment period is less than a month away and you are expecting a loan, stop by the Financial Aid Office to determine why your loan has not been certified.