Subsidized and Unsubsidized FAQs
General Questions
Loan Requirements
General Questions
What Is the Difference Between a "Subsidized" and an "Unsubsidized" Loan?
| Federal Direct Subsidized Loan | Federal Direct Unsubsidized Loan |
|---|---|
| Only undergraduate students may be eligible | Both undergraduate and graduate/professional students may be eligible |
| Student must demonstrate financial need | Financial need is not necessary |
| Interest paid by the federal government as long as you are enrolled at least half-time* | Interest begins to accrue as soon as the loan is disbursed and must either be paid during in-school periods or deferred. This is called "capitalization" because the interest is added to the principal (loan amount borrowed). Then interest accrues on this new, increased principal amount. |
*For subsidized loans borrowed on or after July 1, 2013, there is a limit on the maximum period of time (measured in academic years) that students can receive Direct Subsidized Loans and how long the government will pay the interest. Students may not receive these loans for more than 150% of the published length of their program. Example: If a student is enrolled in a four-year bachelor's degree program, the maximum period they can receive subsidized loans is six years (4 x 1.5 = 6). In addition, if students continue to be enrolled in any undergraduate programs after reaching the 150% limit, the federal government will no longer pay the interest on any subsidized loan debt. Click here to view additional information on the 150% Subsidized Loan Limit.
Do I Need to Apply for Federal Loans Through a Bank?
No. When applicable, federal loans are offered after your Free Application for Federal Student Aid (FAFSA) is received by the University and reviewed for aid eligibility. However, some students who need additional funding for educational expenses also apply for credit-based private loans from non-federal lenders.
How Much Can I Borrow Each Year?
- The maximum amount you can borrow each year varies depending on your grade level and dependency status as determined by the Free Application for Federal Student Aid (FAFSA).
- Annual amounts encompass the fall, spring, and summer semesters for the aid year. Please note if you borrow your maximum annual amount during fall and spring, you would not have federal loan eligibility remaining for summer (even if you choose to enroll at least half-time during the summer semester).
- If you are approaching or have met your aggregate limit, you may not be eligible for the amounts below. See Is there a time limit on how long I can receive loans? for more.
Annual Direct Maximum Subsidized/Unsubsidized Eligibility
(Fall, Spring, and/or Summer Semesters)
Check your Financial Aid Information via your WVU Portal to calculate if you have already borrowed your annual limit in federal student loans. Financial aid - including loans - cannot exceed your estimated cost of attendance (budget).
| Student Rank or Level |
Dependent*
*except students whose parents are unable to obtain PLUS Loans |
Independent**
**and dependent undergraduate students whose parents are unable to obtain PLUS Loans |
|---|---|---|
|
0 to 29 Earned Hours = Freshman
(excluding non-degree seeking students and the first two years of PharmD - see below) |
$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. |
| 30 to 59 Earned Hours = Sophomore
(excluding non-degree seeking students and the first two years of PharmD - see below) |
$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. |
| 60+ Earned Hours = Junior and Senior
(excluding non-degree seeking students and the first two years of PharmD - see below) |
$7,500
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. |
| Non-degree seeking student taking courses required for admission into an undergraduate program.*** |
$2,625
|
$8,625
No more than $2,625 of this amount may be in subsidized loans. |
| First Two Years of Pharmacy (PharmD) - Undergraduate Pharmacy
|
$7,500
No more than $5,500 of this amount may be in subsidized loans. |
9 month aid budget: $25,000
12 month aid budget: $29,167 No more than $5,500 of this amount may be in subsidized loans. |
| Graduate & Professional (with the exception of those listed below) |
N/A
|
$20,500 in unsubsidized loans only
|
| Non-degree seeking student taking courses required for admission into a graduate program.*** | $5,500 |
$12,500
No more than $5,500 of this amount may be in subsidized loans. |
| Teacher Certification/ Re-certification*** | $5,500 |
$12,500
No more than $5,500 of this amount may be in subsidized loans. |
| Professional Medicine (MD) & Dentistry (DDS) | N/A | 9 month aid budget: $40,500
12 month aid budget: $47,167 Unsubsidized loans only |
| Professional Doctor of Pharmacy (last 2 years of PharmD), Public Health, Clinical Psychology,& Health Administration (last 2 years) | N/A | 9 month aid budget: $33,000
12 month aid budget: $37,167 Unsubsidized loans only |
***Loan eligibility for non-degree students is limited to a single consecutive 12-month period for students in preparatory coursework (for a degree-seeking program). This limitation does not apply to those seeking teacher certification/re-certification. Those seeking teacher certification/re-certification are considered undergraduate for aid purposes. Students will be monitored throughout the enrollment period to ensure they remain eligible.
Please note that actual loan amounts are based on financial need, cost of attendance, eligibility, and other applicable limitations.
What Is the Interest Rate?
Interest rates on Federal Direct Loans are fixed, meaning the interest rate on the amount borrowed for an academic year will remain the same for the life of the loan.
Federal loan borrowers can monitor loan debt, check interest rates, and find their loan servicer by logging into the Federal Student Aid website with their Federal Student Aid ID (FSA ID).
Additional information on interest rates, fees, and calculation can be found on the Federal Student Aid website about understanding interest.
Am I Charged Any Additional Fees When I Borrow a Federal Direct Loan?
Yes, a processing fee is retained by the federal government for federal loans. It is a percentage of the amount of the loan, and it is deducted before the loan disburses to the institution. This means the loan amount accepted and borrowed will be different from the amount that disburses. This is referred to as an "origination fee," "loan fee," or "processing fee."
Fees for the current aid year can be found on the Federal Interest Rates and Fees webpage on the Federal Student Aid website. Fees vary based on the date the loan disburses.
You can refer to our Origination Fee webpage for additional information and a tool that will help you calculate the amount that will disburse as payment toward your institutional charges based on the amount you borrow for Federal Subsidized, Unsubsidized, Parent PLUS, and Graduate PLUS Loans OR how much you should borrow to disburse a certain amount (for example, to cover a certain balance due).
A fee is deducted from each disbursement and retained by the federal government, which is why the accepted loan amount and disbursed amount on your account will differ. This is referred to as an "origination fee," "loan fee," or "processing fee."
More information can be found on the Interest Rates and Fees for Federal Student Loans webpage of the Federal Student Aid website.
You can click here to download an origination fee spreadsheet that will help you calculate the amount that will disburse as payment toward your institutional charges based on the amount you borrow for Federal Subsidized, Unsubsidized, Parent PLUS, and Graduate PLUS Loans OR how much you should borrow to disburse a certain amount (for example, to cover a certain balance due).
Who Should I Contact about the Details of My Loans?
Find information about federal direct loan account balances, contact information, repayment, billing, and payment options for your loan servicer by logging in to the Federal Student Aid website with your Federal Student Aid ID (FSA ID).
Where Can I Get Additional Information?
You can view additional information regarding loans on the Federal Student Aid Website on student loans for college.
Loan Requirements
What is half-time enrollment to be eligible for federal loans?
You must be enrolled at least half-time for the semester in federal and state aid-eligible courses for loans to disburse as payment.
Do I Need to Maintain Satisfactory Academic Progress for Loans?
Since subsidized and unsubsidized loans fall into the category of Title IV federal financial aid, you must continue to maintain satisfactory academic progress for financial aid eligibility in order to remain eligible for the loans.
Is There a Time Limit on How Long I Can Receive Loans?
There are three types of loan limits for the time you are in school.
1. Satisfactory Academic Progress
Students must maintain a certain level of satisfactory academic progress in order to maintain eligibility for aid — including student loans, parent loans, Federal Work-Study, some scholarships, and grants. At the end of spring semester the academic record of each student will be reviewed to determine if the student is meeting minimum academic progress standards.
These standards include:
- A minimum overall grade point average;
- Completion of a minimum percentage of all attempted credit hours;
- A maximum amount of attempted hours based on the student’s degree objective.
Students not meeting academic progress standards will be suspended from aid eligibility immediately. This includes federal loans. More details on satisfactory academic progress and options to appeal can be found on the Satisfactory Academic Progress page.
2. Aggregate Loan Limit
Aggregate loan limit refers to the maximum amount of federal loans a student may borrow during particular levels of their education. There are different aggregate limits based on if the student is at an undergraduate, graduate, or professional level.
Undergraduate Federal Loan Aggregate Limits
| Student Type | Aggregate Limits |
|---|---|
| Dependent undergraduate (excluding non-degree seeking students and first two years of PharmD below) | $31,000
No more than $23,000 of this amount can be in subsidized loans. |
| Independent undergraduate (excluding non-degree seeking students and first two years of PharmD below) | $57,500
No more than $23,000 of this amount can be in subsidized loans. |
| Dependent, non-degree seeking student taking courses required for admission into an undergraduate program | $31,000
No more than $23,000 of this amount can be in subsidized loans. |
| Independent, non-degree seeking student taking courses required for admission into an undergraduate program | $57,500
No more than $23,000 of this amount can be in subsidized loans. |
| First two years of Pharmacy (PharmD) (undergraduate Pharmacy) | $224,000
No more than $23,000 of this amount can be in subsidized loans. Please note this aggregate limit is for the entire PharmD program, including the professional years. |
Graduate/Professional Federal Loan Aggregate Limits
| Student Type | Aggregate Limits |
|---|---|
| Graduate/professional student (excluding the students and programs listed below) | $138,500
This includes any federal loans borrowed as an undergraduate. |
| Non-degree seeking student taking courses required for admission into an graduate program (Those seeking teach certification/recertification review the section above for non-degree seeking student taking courses required for admission into an undergraduate program.) | $138,500
This includes any federal loans borrowed as an undergraduate. |
| Dependent, non-degree seeking student taking courses required for admission into an undergraduate program | $31,000
No more than $23,000 of this amount can be in subsidized loans. |
| Medicine (MD) and Dentistry (DDS) | $224,000
This includes any federal loans borrowed as an undergraduate. |
| Public Health, Clinical Psychology, Health Administration, and last two years of Pharmacy (PharmD) | $224,000
This includes any federal loans borrowed as an undergraduate. |
3. 150% Subsidized Loan Limit
For subsidized loans borrowed on or after July 1, 2013, there is a limit on the maximum period of time (measured in academic years) that students can receive Direct Subsidized Loans and how long the government will pay the interest.
Students may not receive these loans for more than 150% of the published length of their program. Example: If a student is enrolled in a four-year bachelor's degree program, the maximum period they can receive subsidized loans is six years (4 x 1.5 = 6).
In addition, if students continue to be enrolled in any undergraduate programs after reaching the 150% limit, the federal government will no longer pay the interest on any subsidized loan debt. Click here to view additional information on the 150% Subsidized Loan Limit.