Student loans can help fill the gap between the cost of attendance and the amount of aid received through scholarships and grants. However, because these funds must be repaid, students are encouraged to only borrow the amount they need. TCL students must submit a Loan Request through Self Service in order to be evaluated for federal loan eligibility.
TYPES OF LOANS
FEDERAL DIRECT LOAN
Federal Direct Loans are federally regulated low-interest educational loans provided by lending institutions. Student must be enrolled at least half-time (6 credit hours for undergraduate) in a Title IV eligible program and maintain satisfactory academic progress. Financial need is not necessary, but the Free Application for Federal Student Aid (FAFSA) is required. Loan repayment begins six months after graduation or departure from school.
SUBSIDIZED VS. UNSUBSIDIZED DIRECT LOANS
Subsidized Direct Loans
A subsidized Direct Loan is awarded to undergraduate students only based on financial need as determined by the results of the FAFSA and other financial aid (such as grants and scholarships) received. You will not be charged interest on the loan while you are in school at least half-time or during grace and deferment periods. The federal government “subsidizes” the interest on these loans.
Unsubsidized Direct Loans
An unsubsidized Direct Loan is not awarded based on financial need. You will be charged interest on the loan from the time of the first disbursement until it is paid in full. If you allow the interest to accumulate while you are in school (or during other periods of nonpayment), it will be capitalized. This means the interest will be added to the original principal amount of your loan, and additional interest will be based on the higher amount. Making interest-only payments while in school will result in a lower amount repaid in the long run.
LOAN AMOUNTS
THE MAXIMUM AMOUNT YOU CAN BORROW EACH ACADEMIC YEAR DEPENDS ON YOUR GRADE LEVEL AND DEPENDENCY STATUS. SEE THE CHART FOR ANNUAL AND LIFETIME BORROWING LIMITS. THE AMOUNTS BELOW ARE THE MAXIMUM VALUES — YOU MIGHT NOT BE ELIGIBLE FOR THE MAXIMUM ANNUAL AMOUNTS BECAUSE OF OTHER FINANCIAL AID YOU RECEIVE.
MAXIMUM LOAN AMOUNTS
| Year | Dependent Undergraduate | Independent Undergraduate |
|---|---|---|
| First (0-29 earned hours) | $5,500 (including up to $3,500 subsidized) | $9,500 (including up to $3,500 subsidized) |
| Second (30-59 earned hours) | $6,500 (including up to $4,500 subsidized) | $10,500 (including up to $4,500 subsidized) |
| Third and beyond (60+ earned hours) | $7,500 (including up to $5,500 subsidized) | $12,500 (including up to $5,500 subsidized) |
| Aggregate Loan Limits | $31,500 (including up to $23,000 subsidized) | $57,500 (including up to $23,000 subsidized) |
HOW TO APPLY FOR A DIRECT LOAN
The FAFSA is required for both subsidized and unsubsidized Federal Direct Loans. When you complete the FAFSA, and all required verification documents (if applicable), you have the option to complete a Loan Request Form through the Financial Aid portal of your Self Service account. After your Loan Request Form has been submitted you do have the option to submit a Loan Adjustment Form (found on the Financial Aid Forms page) to reduce the amount of your loan or decline the loan completely.
To complete the loan process, you will need to:
- Complete the Loan Request Form in Self Service.
- Complete entrance loan counseling at studentaid.gov if this is your first loan at TCL.
- Complete a Master Promissory Not (MPN) at studentaid.gov if this is your first Direct Loan.
- When notified to do so, accept the financial aid offer in the Self Service Financial Aid portal.
View Interest Rates for Federal Direct Loans
PROMISSORY NOTES
An electronic loan application will be created and transmitted to the U.S. Department of Education. First-time borrowers through the Direct Loan program will be directed to complete a promissory note. This can be done electronically at studentaid.gov. The promissory note is a legal, binding document whereby you agree to repay the loan.
CHANGING LOAN AMOUNTS
You are encouraged to only borrow needed funds. If your originally request a loan for more than you desire, you can reduce the amount by submitting a Loan Adjustment Form located on the Financial Aid Forms page. You will need to complete the form in its entirety and submit electronically to the Office of Financial Aid.