Federal Direct Loan Program

The Bill Gatton College of Pharmacy participates in the William D. Ford Direct Loan Program in an effort to meet students’ needs.

The Direct Loan Program offers several low-interest loans to graduate and professional students.

Direct Subsidized Loans

Direct Subsidized Loans for graduate and professional student borrowers are made for up to $8,500 per school year and have a fixed interest rate. The actual amount that you will receive may be less, depending on your financial need and other factors.  Financial need is your cost of attendance minus your estimated financial assistance and your Expected Family Contribution or EFC.
Fixed Interest Rate: 6.8%

No interest accrues while you are in school at least half-time, during grace and deferment periods.

Direct Unsubsidized Loans

Direct Unsubsidized Loans can be used to meet your remaining education costs and to replace your EFC. The interest rate on unsubsidized loans is also a fixed rate. Professional pharmacy students may borrow up to $24,500 per school year, less any direct Subsidized Loan amount you receive.

Fixed Interest Rate: 6.8%

*Interest begins to accrue with the first disbursement of your loan.  You’re responsible for paying interest during all periods.

Direct PLUS Loans

Direct PLUS Loans can be made to graduate or professional students who need to borrow more than the maximum subsidized and unsubsidized loan amounts to meet education costs that are not covered by other financial aid.  The interest rate for PLUS loans is also a fixed rate: 6.8%

*Interest begins to accrue with the first disbursement of your loan.  You’re responsible for paying interest during all periods.

*If you choose not to pay the interest on your Direct Unsubsidized or PLUS loan while you’re in school, the DOE will add it to the unpaid principal amount of your loan when you enter repayment. This is called “capitalization”.  Capitalization increases the unpaid principal balance of your loan, and the DOE will then charge interest on the increased principal amount.  Check your interest statements, and use the online calculators at www.dl.ed.gov to find out how much you’ll pay over the life of the loan if the in-school interest is added to your loan balance.

Is there a fee for the Direct Loan?

Yes, it is called the origination fee.  You pay a fee that is a percentage of each Direct Loan that you receive.  The amount will be shown on the disclosure statement that you will receive.  Disclosure statements tell you the type of loan (Subsidized, Unsubsidized and PLUS), the amount of the loan, the amount of each disbursement, the fees, and other information about the loan. The fee is deducted before you receive any loan, so the loan amount you actually receive will be less than the amount you have to replay.  The origination fee for a Direct loan is 4%; however, you are offered an interest rate rebate that helps reduce this fee.  Once you begin repayment, you must make 12 on-time monthly payments to retain this benefit.

For more information about the Direct Loan Program, visit the Direct Loan Page for Students

PUT Program Frequently Asked Questions for students handout