Federal Direct Loans
Federal Direct Loans Overview
Federal Direct Subsidized and Unsubsidized Loans are provided by the US Department of Education (DoE) under the Higher Education Act to help students cover education costs.
- Subsidized Loans: For students with demonstrated Financial Need (FN). No interest charged while enrolled at least half-time (6 credits or more).
- Unsubsidized Loans: No FN requirement. Interest accrues from full disbursement, but students can optionally pay interest while still in school.
Learn more about borrowing limits, eligibility, and interest rates here.
Loan Repayment Information
Repayment for Federal Direct Loans begins six months after you graduate, withdraw, or fall below half-time enrollment. This is known as the grace period.
Loan Servicer Assignment
After your Federal Direct Loan is disbursed to you, the DoE assigns your loan to a Loan Servicer. The Loan Servicer will administer your loan, you will establish your repayment plan through them. Your Loan Servicer and Federal Student Loan information can be found on your www.studentaid.gov account dashboard. If you are not able to access studentaid.gov, you can receive a free credit report at www.annualcreditreport.com. Your student loan will be listed on your credit report along with the servicer information and the status of the loan; go to the servicer’s website and register.
Please view our ‘Do I have Student Loans? | Who is My Servicer?’ tutorial for additional guidance, https://www.youtube.com/watch?v=WDu2acC7eAc
Deferment Options
Once your loan enters repayment, you may be able to defer payments under certain conditions, including:
- Enrollment in school (half-time or more)
- Unemployment
- Economic hardship
You’ll need to request deferment through your loan servicer.
Delinquency and Default
Once the six-month grace period has ended, your Federal Student Loan will go into repayment. If you miss making a payment your loan is considered delinquent. If you are delinquent on your payments for 90 days or more, your loan servicer will report the delinquency to the national credit bureaus which may negatively impact your credit rating. Loans that have been delinquent for at least 270 days may go into default. Additional information on student loan delinquency and default can be found on the studentaid.gov website, https://studentaid.gov/manage-loans/default.
If you are having trouble making your student loan payments, contact your loan servicer immediately.
Default Rates
The DoE tracks default rates by school. Riverland’s most recent three-year cohort default rate (2021) was 0.0%.
For national cohort default rates and institution specifics, visit the Federal Student Aid default management site.