Savanna Hoffman
Student loans are a common way to fund college costs, but they must be paid back with interest over a certain period. Federal student loans are often the most affordable option with low-interest rates, but there are also private loans available. The US Department of Education provides federal student loans, and they are taking urgent action to address challenges with their loan program. It is important to understand the different types of loans and their requirements, such as Federal Direct Subsidized Loans for undergraduates with financial needs, Federal Direct Unsubsidized Loans for undergraduates and graduates with no financial need requirements, and Federal Parent Plus Loans. Students should only borrow what they need and keep track of their debt.
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What You'll Learn
Federal Student Aid website
The Federal Student Aid website provides information on student financial aid opportunities such as work-study, federal loan programs, and grants. The website is a useful resource for students seeking financial assistance for their college education.
To apply for federal student aid, individuals can complete the Free Application for Federal Student Aid (FAFSA). The FAFSA can be submitted online, and applicants are required to create an account and obtain a Federal Student Aid (FSA) ID. This FSA ID allows individuals to sign and submit their FAFSA form. It is important to note that sharing sensitive information should only be done on official and secure websites, as indicated by the HTTPS protocol.
The Federal Student Aid Information Center offers support to students throughout the FAFSA process. They can be contacted by calling 1-800-4-FED-AID to speak with a specialist. Additionally, the Knowledge Center website provides valuable resources for financial aid administrators and professionals, including the FSA Handbook, Dear Colleague Letters, and electronic announcements.
The Federal Student Aid website also highlights the financial support provided by the U.S. Department of Education. Annually, the department awards over $120 billion in grants, work-study funds, and low-interest loans to approximately 13 million students. This includes federal grants, which do not require repayment, and low-interest federal loans with flexible repayment options.
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Federal Direct Subsidized Loans
To be eligible for a subsidized loan, a student must demonstrate financial need. The loan is disbursed to the student's account, and interest begins to accrue on the loan at that time. If a subsidized loan is disbursed between July 1, 2012, and July 1, 2014, the borrower is responsible for the interest that accrues during the grace period. For first-time borrowers on or after July 1, 2013, there is a limit to the maximum period of time for receiving Direct Subsidized Loans, which is generally 150% of the published length of the borrower's program. For example, if a borrower is enrolled in a four-year bachelor's degree program, the maximum period for receiving Direct Subsidized Loans is six years.
The Free Application for Federal Student Aid (FAFSA) is the only application required to apply for Federal Direct Loans, and it must be completed annually. The Federal Loan Servicer Information FSA Loan Simulator provides information on Direct Subsidized and Unsubsidized Loans, but this information is subject to change without notice due to changes in federal, state, and/or institutional rules and regulations.
It is important to note that effective July 1, 2012, the Subsidized Direct Loan is no longer available to graduate or professional students. Additionally, there are limits to the amount of subsidized loans that graduate and professional students can borrow. For example, full-time Doctor of Pharmacy, Graduate in Public Health, and Clinical Psychology students may be eligible for up to $12,500 in additional unsubsidized loans, while full-time Doctor of Allopathic Medicine and Doctor of Dentistry students may be eligible for up to $20,000. The lifetime aggregate for these programs is $224,000.
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Federal Direct Unsubsidized Loans
To be eligible for a Direct Unsubsidized Loan, you must be enrolled at least half-time at a school that participates in the Direct Loan Program. Additionally, you must be enrolled in a program that leads to a degree or certificate awarded by the school. Direct Unsubsidized Loans are typically available to both independent and dependent students, with aggregate loan limits in place. For dependent students (except those whose parents were not eligible for Direct PLUS Loans), the limit is up to $31,000 in subsidized and unsubsidized loans, with no more than $23,000 of that amount in subsidized loans.
Interest is charged during all periods of the loan and may be capitalized at certain times, which can increase the total federal loan cost. It is important to note that federal student loans offer more flexibility than private student loans. Borrowers can change their repayment options even after the loan has been disbursed, and there is no requirement for a strong credit history. Federal loans also offer income-driven repayment plans for qualifying borrowers, which are based on income and family size.
To apply for a Direct Unsubsidized Loan, you need to submit your Free Application for Federal Student Aid (FAFSA). This application will help determine your eligibility and the amount you can borrow.
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Federal Parent Plus Loans
To be eligible for a Parent PLUS Loan, parents and students must meet certain requirements. Both must be U.S. citizens or eligible non-citizens and cannot be in default on any federal loan or owe an overpayment on a federal grant. Additionally, the borrower must not have an adverse credit history as defined by the U.S. Department of Education. The student must be under 24, unmarried, and have no legal dependents when submitting the FAFSA. They must also be enrolled at least half-time in school.
The application process for a Parent PLUS Loan begins with the student completing the FAFSA (Free Application for Federal Student Aid). Once the FAFSA is submitted, the parent can apply for the loan online at the official student aid website. A new application is required for each dependent student and for each academic year. If approved, the parent must complete and sign a Parent PLUS Master Promissory Note (MPN).
Repayment of the Parent PLUS Loan begins once the loan is fully disbursed. Parents can request a deferment if their child is still enrolled at least half-time or for an additional six months after their child is no longer enrolled half-time. It is important to note that interest will accrue during the deferment period. There are several repayment plans available for Parent PLUS Loans.
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Mizzou's Office for Financial Success
The office is open Monday to Friday, 8 am to 5 pm, with phone centre hours of 8:30 am-12:30 pm and 1 pm-4:30 pm. You can contact the office by phone on 573-882-7506, by fax on 573-884-5335, or by email at [email protected].
Students can also schedule an appointment to talk with a financial aid advisor in person, by phone, or via Zoom. The website provides a link to schedule an appointment. Visitor parking permissions are available through Parking and Transportation.
There are several important dates to keep in mind for the 2025-2026 academic year. The scholarship deadline for first-time college students is December 1, 2024, while the deadline for continuing and transfer students is February 1, 2025, along with the FAFSA submission deadline.
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Frequently asked questions
A student loan is money borrowed to pay for college, which must be paid back over time with interest.
There are federal student loans, issued by the federal government, and private loans, offered by banks and other lenders. Missouri also has the Missouri Family Education Loan Program (MOFELP), a private loan programme with no interest.
You can apply for federal loans by filing your FAFSA (Free Application for Federal Student Aid). For private loans, you can apply directly through a bank or lender, or use a tool like ELM Select to compare different loan programs.
You will be notified by your loan servicer about when and how much you need to repay. You can choose from several repayment plans to suit your needs. Repayments usually start six months after you leave school or drop below half-time enrollment.
