Federal loans
Loans may be part of financial aid options
Complete the FAFSA application , using Columbia College’s school code 002456 to have the results sent to Columbia College. Once your FAFSA is processed and eligibility is determined. you will be sent notification that details your financial aid package.
When you apply for financial aid, loans may be offered as part of your financial aid package. A loan is money you borrow and must pay back with interest. The U.S. Department of Education’s federal student loan program is the William D. Ford Federal Direct Loan Program. Under this program, the U.S. Department of Education is the lender. You may accept, accept in part, or deny offered loans.
The difference between Direct Subsidized Loans and Direct Unsubsidized Loans
Direct Subsidized loan - A loan for which the government pays the interest while you are in school, during grace periods, and during any deferment periods.
Direct Unsubsidized loan - A loan for which you are responsible for paying all of the interest that accrues from the date of the first disbursement until the loan is paid in full.
Direct PLUS Loans
Direct PLUS Loans may be available to eligible parents and graduate or professional students. A Direct PLUS Loan is commonly referred to as a parent PLUS Loan when made to a parent, or as a grad PLUS Loan when made to a graduate or professional student. Parents must not have an adverse credit history. A credit check will be conducted. If a parent is denied the loan during the credit check, additional federal loan eligibility may be made available in the student's name.
The maximum PLUS Loan amount you can receive is the cost of attendance (determined by the school) minus any other financial aid received.
Loan interest rates and calculating interest
Interest is a loan expense charged for the use of borrowed money. Interest is paid by you, the borrower, to the U.S. Department of Education, the lender. The expense is calculated as a percentage of the unpaid principal amount of the loan.
| Loan type | Borrower type | Fixed interest rate (%) |
|---|---|---|
| Direct Subsidized and Direct Unsubsidized Loans | Undergraduate | 4.99 |
| Direct Unsubsidized Loans | Graduate | 6.54 |
| Direct PLUS Loans | Parents and Graduate or Professional Students | 7.54 |
Interest rates for Direct Loans first disbursed on or after July 1, 2022 and before July 1, 2023.
Calculating interest & interest rate factor
The amount of interest that accrues (accumulates) on the loan between monthly payments is determined by a daily interest formula. This formula consists of multiplying the loan balance by the number of days since the last payment was made and multiplying that result by the interest rate factor.
Simple daily interest formula:
Interest Amount = (Outstanding Principal Balance x Interest Rate Factor) x Number of Days Since Last Payment
The interest rate factor is used to calculate the amount of interest that accrues on the loan. It is determined by dividing the loan's interest rate by the number of days in the year.
Federal Direct Loan fees
In addition to interest there is a loan fee applied to Direct PLUS loans. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. You’re responsible for repaying the entire amount you borrowed and not just the amount you received. The percentage varies depending on when the loan is first disbursed, as shown in the chart below.
| Loan type | First disbursement date range |
Loan fee (%) |
|---|---|---|
| Direct Subsidized and Direct Unsubsidized Loans | 10/1/2020 - 9/30/2023 | 1.057 |
| 10/1/2019 - 9/30/2020 | 1.059 | |
| Direct PLUS Loans | 10/1/2022 - 9/30/2023 | 4.228 |
| 10/1/2021 -9/30/2022 | 4.228 |
Direct Loan limits
There are limits on the amount in subsidized and unsubsidized loans that you may be eligible to receive each academic year (annual loan limits) and the total amounts that you may borrow for undergraduate and graduate study (aggregate loan limits).
| Academic year, grade level classification | Credit hours | Total subsidized and unsubsidized loans available to dependent Students1 | Subsidized limit for dependent students |
Total subsidized and unsubsidized loans available to independent Students2 | Subsidized limit for independent students |
|---|---|---|---|---|---|
| Freshman Undergraduate Annual | 0- 29.9 | $5,500 | $3,500 |
$9,500 | $3,500 |
| Sophomore Undergraduate Annual | 30 – 59.9 | $6,500 | $4,500 |
$10,500 | $4,500 |
| Junior Undergraduate Annual | 60-89.9 | $7,500 | $5,500 |
$12,500 | $5,500 |
| Senior Undergraduate Annual | 90+ | $7,500 | $5,500 |
$12,500 | $5,500 |
| Graduate or Professional Students Annual | N/A | N/A3 | N/A |
$20,500 (unsubsidized only) |
N/A |
| Undergraduate subsidized and unsubsidized Aggregate | N/A | $31,000 | $23,000 |
$57,500 |
$23,000 |
| Graduate and professional student subsidized and unsubsidized aggregate | N/A |
N/A | N/A |
$138,5004 |
$65,500 |
1Except students whose parents are unable to obtain PLUS Loans
2And dependent undergraduate students whose parents are unable to obtain PLUS Loans
3All graduate and professional students are considered independent
4The graduate aggregate limit includes all federal loans received for undergraduate study