Direct Loans

Types of Loans

Direct Subsidized Loans

Direct Subsidized Loans are available to undergraduate students who demonstrate financial need, as determined by the FAFSA. While you are enrolled at least half-time (6 credits), the federal government pays the interest on this loan. Interest begins to accrue after the six-month grace period ends and continues throughout the repayment period.

Direct Unsubsidized Loans

Direct Unsubsidized Loans are available to students who do not qualify for a Direct Subsidized Loan based on financial need, or who qualify for only a portion of the annual subsidized loan limit. Interest accrues on this loan from the time it is disbursed, including while the student is enrolled in school. Students may choose to pay the interest while in school or allow it to be capitalized (added to the loan principal) and repaid during the repayment period.

 

empty table header Dependent Undergraduate Students Independent Undergraduate Students Graduate, Law, and APD Students
0-29 $5,500 - No more than $3,500 of this amount may be subsidized $9,500 - No more than $3,500 of this amount may be subsidized $20,500 - No subsidized amount is available
30-59 $6,500 - No more than $4,500 of this amount may be subsidized $10,500 - No more than $4,500 of this amount may be subsidized $20,500 - No subsidized amount is available
60+ $7,500 - No more than $5,500 of this amount may be subsidized $12,500 - No more than $5,500 of this amount may be subsidized $20,500 - No subsidized amount is available
Maximum total debt from Direct Loans $31,000 - No more than $23,000 of this amount may be subsidized $57,500 - No more than $23,000 of this amount may be subsidized $138,500 - No more than $65,000 of this amount may be subsidized
 

Stafford Loan Changes Under the One Big Beautiful Bill Act (OBBBA)

New Graduate Loan Limits
  • Graduate students:
    • Annual limit: $20,500
    • Aggregate (lifetime) limit: $100,000
  • Professional students:
    • Annual limit: $50,000
    • Aggregate (lifetime) limit: $200,000
  • These limits do not include any federal loans borrowed for undergraduate study.
Legacy (“Grandfathered”) Borrowing Provisions
  • If you are already enrolled in your current program and received a disbursement of a federal Direct Loan (including Direct Unsubsidized or Graduate PLUS loans) before July 1, 2026, you may continue borrowing under the current loan limits, including access to Graduate PLUS loans for up to three additional years or until your current program ends, whichever comes first.

Important Limitations of the Legacy Clause
  • The legacy provision applies only to your current program of study.
  • If you borrowed federal loans for a previous program and begin a new program after July 1, 2026, you will not be eligible for Graduate PLUS loans in the new program.
  • You must remain continuously enrolled to retain legacy eligibility.
    • Withdrawals or leaves of absence for any reason may result in loss of legacy status

Definition of a Professional Degree (Under OBBBA)

Under the new bill, a professional degree:

  • Prepares students to begin practice in a specific profession
  • Requires a level of professional skill beyond a bachelor’s degree
  • Is generally at the doctoral level
  • Requires at least six academic years of postsecondary coursework, including two years beyond the bachelor’s level
  • Typically requires professional licensure to practice
  • Includes programs with a four-digit CIP code aligned with fields such as:
  • Pharmacy (Pharm.D.)
  • Dentistry (D.D.S. or D.M.D.)
  • Veterinary Medicine (D.V.M.)
  • Chiropractic (D.C. or D.C.M.)
  • Law (J.D. or L.L.B.)
  • Medicine (M.D.)
  • Osteopathic Medicine (D.O.)
  • Optometry (O.D.)
  • Podiatry (D.P.M., D.P., or Pod.D.)
  • Theology (M.Div., M.H.L.)
  • Clinical Psychology (Psy.D. or Ph.D.) 
Professional Student Eligibility Rules
  • A professional student may not receive Title IV aid as an undergraduate for the same period of enrollment.
  • The student must be enrolled in a program that leads to a professional degree.
Opting Out of Legacy Status Based on the current draft of the bill, students will not be able to opt out of legacy eligibility if they qualify.

If you are enrolled less than full-time during the academic year, your federal loan eligibility will be adjusted. This means your loan amount is reduced in direct proportion to your percentage of full-time enrollment.

Common Questions

 

This decision is up to you. We recommend borrowing only what you need to cover your educational expenses, keeping in mind that everyone’s situation is different.

One helpful approach is to subtract any grants and/or scholarships you receive from your total cost. Be sure to factor in loan origination fees when calculating how much you’ll actually receive.

You can also choose to accept a smaller loan amount now and request the remaining portion later in the semester, as long as you continue to meet loan eligibility requirements.

Yes. If you are a first-time borrower of federal student loans, you must complete both a Master Promissory Note (MPN) and Entrance Counseling before your loan can be applied to your account balance.

 

Both requirements can be completed online through the Federal Student Aid website. The MPN is valid for 10 years, while Entrance Counseling is only required during the first semester you borrow federal loans at UBalt.

 

If you are transferring to UBalt and previously received a Direct Loan at another institution, your MPN will transfer automatically. However, you must log in to the Federal Student Aid website to request that your Entrance Counseling be transferred to UBalt.

No. We recommend borrowing only the amount you need. When accepting your financial aid, you can adjust the loan amount after clicking the Accept button to reflect what you want to borrow. Keep in mind that the total amount you borrow will be split evenly between the fall and spring semesters.

While interest rates are fixed for the life of the loan, the interest rates can change each year you accept a new loan. For the current rates, please visit the  Federal Student Aid website for Direct Loans.

 Please see the Federal Student Aid website for a list of federal loan fees.

After you graduate, leave school, or drop below half-time enrollment, you will have a six-month grace period before you are required to begin repayment. During this period, you'll receive repayment information from your loan servicer, and you'll be notified of your first payment due date. Payments are usually due monthly.

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