Loans

Federal Direct Subsidized Stafford Loan

A Federal Direct Subsidized Stafford Loan is awarded on the basis of the student's financial need and other specific eligibility requirements. The federal government does not charge interest on these loans while borrowers are enrolled at least half-time.

Federal Direct Loan borrowers taking their first loan on or after July 1, 2013 may qualify for a subsidized Direct Loan for a maximum of 150% of the length of their academic program. Students will be limited to receiving subsidized loans 6 years in a 4 year program. Students reaching this limitation could receive unsubsidized loans if eligible. Additionally, borrowers who reach the 150% limitation will have their interest subsidy end for all outstanding subsidized loans.

Graduate/law students will no longer be eligible for Federal Subsidized Loans for aid periods after July 1, 2012. The graduate/law annual loan limit remains unchanged at $20,500 in the Federal Unsubsidized loan.

Federal Direct Unsubsidized Stafford Loan

A Federal Direct Unsubsidized Stafford Loan is not based on the student's financial need, but students must also meet specific eligibility requirements. Interest is charged throughout the life of the loan. The borrower may choose to pay the interest charged on the loan or allow the interest to be capitalized (added to the loan principal).

Federal Perkins Loan

The Federal Perkins Loan is a fixed, 5% interest loan awarded on the basis of financial need demonstrated by the Free Application for Federal Student Aid (FAFSA). Currently, congress has not given approval to extend the Federal Perkins Loan Program after September 30, 2017.

A separate application is required for the following loans:

Federal PLUS Loan for Graduate/Professional Student Borrowers (Grad PLUS)

The Federal Grad PLUS Loan is not based on financial need and is limited to graduate and professional level students attending at least half-time. The annual limit is equal to the student's cost of attendance, as defined by The University of Alabama, minus any other financial aid the student is receiving. Applicants are required to pass a credit check. PLUS loans carry a fixed interest rate and an origination fee. We must receive the results of your completed FAFSA before we can process your Federal PLUS Application. Apply for a Federal Graduate PLUS loan here. Certain borrowers may also be required to complete federal PLUS loan counseling. Direct Loans will notify you if you need to complete the counseling requirement.

  • Apply for Fall 2016 Grad PLUS Loans until December 6, 2016.
  • Apply for Spring 2017 Grad PLUS Loans until May 2, 2017.
  • Apply for Summer 2017 Grad PLUS Loans until August 1, 2017.
  • The 2017-2018 Grad PLUS Loan application will be open April 15, 2017.

Federal Direct Parent Loan for Undergraduate Students (PLUS)

The PLUS is not based on financial need and is limited to a parent borrower for a dependent student attending at least half-time. A parent is currently defined as a person's natural or adoptive mother or father, or the step-parent married to the custodial parent. The annual limit is equal to the student's cost of attendance, as defined by The University of Alabama, minus any other financial aid the student is receiving. Parents are required to pass a credit check. PLUS loans carry a fixed interest rate and an origination fee. We must receive the results of your completed FAFSA before we can process your Federal PLUS Application. Apply for a Federal Parent PLUS loan here. Certain borrowers may also be required to complete federal PLUS loan counseling. Direct Loans will notify you if you need to complete the counseling requirement.

  • Apply for Fall 2016 PLUS Loans until December 6, 2016.
  • Apply for Spring 2017 PLUS Loans until May 2, 2017.
  • Apply for Summer 2017 PLUS Loans until August 1, 2017.
  • The 2017-2018 PLUS Loan application will be open April 15, 2017.

Alternative Loans

Alternative loans are private (non-federal) loans. Unlike the previously mentioned loans, you are not considered for these loans when you complete the FAFSA. The terms vary widely as do the eligibility criteria.

You (and your co-borrower, if applicable) should carefully research the options and apply for the alternative loan that best suits your needs. Keep in mind that usually your best option is to pursue federal loans. Be sure you have applied for all of the federal loans you are eligible for before you consider private loans. If you do wish to take out a private educational loan, you need to provide any documentation requested by the sponsor of the loan and follow the application procedure that is specific to that loan.