Federal Direct Loans
A Federal Direct Loan is a low-interest-rate loan for students that can be used to help pay for your college education. Please note, if you are graduating at the end of fall semester, review information on loan proration as your loan amounts will be impacted.
Subsidized Vs. Unsubsidized
Subsidized If you meet certain financial need criteria (based upon information supplied on your FAFSA), the federal government will pay the interest on your federal Direct Subsidized loan while you attend school at least half-time or during times when you qualify for an authorized deferment.
Unsubsidized If you do not meet the financial need criteria (based upon information supplied on your FAFSA) to qualify for a Subsidized loan, you still can receive a federal Direct Unsubsidized loan. You are responsible for paying the interest while you are in school. If you do not make the interest payments, the interest will be added to your principal balance through a process called capitalization.
Interest Rates
Direct Loans (Subsidized and Unsubsidized) for undergraduate borrowers first disbursed on or after July 1, 2025 and before July 1, 2026 will have a fixed interest rate of 6.39%
Loan Fees
Direct Loans (Subsidized and Unsubsidized) for undergraduate borrowers first disbursed on or after October 1, 2020 will have an origination loan fee of 1.057%. This fee covers administrative costs of the loan.
Enrollment Intensity
Beginning July 1, 2026, the One Big Beautiful Bill Act (OBBBA) introduces new federal rules requiring Direct Loan eligibility to be prorated based on a student’s enrollment intensity. Beginning with the 2026–2027 academic year, students enrolled full time (minimum of 12 credits per semester for undergraduate studies) may receive their full annual Direct Loan eligibility, while students enrolled less than full time will have their loans reduced proportionally based on their enrollment percentage (i.e., the number of credits they register for in a given term). Because enrollment intensity is reviewed each term, loan amounts may vary from semester to semester depending on a student’s credit load.
Borrowing Limits
The annual borrowing limit is determined by your degree status grade level and your dependency status (based upon information you supplied on your FAFSA). In addition to annual loan limits, there are also lifetime Direct loan borrowing limits, also known as the aggregate limit.
In addition to the annual borrowing limits, there is also an aggregate, or cumulative, lifetime borrowing limit.
| Annual Limits | ||
|---|---|---|
| First Year Undergraduate (0-29 credit hours earned) | Dependent Student $5,500 | Independent Student $9,500 |
| Second Year Undergraduate (30-59 credit hours earned) | Dependent Student $6,500 | Independent Student $10,500 |
| Third Year and beyond Undergraduate (greater than 60 credit hours) | Dependent Student $7,500 | Independent Student $12,500 |
| Aggregate Limits | ||
|---|---|---|
| Dependent Undergraduate | Subsidized $23,000 | Total $31,000 |
| Independent Undergraduate | Subsidized $23,000 | Total $57,500 |
Repayment
With either the federal Direct Subsidized or Unsubsidized loans, repayment on the principal begins six months after graduation, leaving school, or dropping below half-time status. There are multiple repayment plans ranging from 10 years to 30 years.
Entrance and Exit Counseling
New federal Direct Loan recipients are required to complete entrance counseling. New federal Direct Loan borrowers are notified and typically complete entrance counseling online as they sign the Master Promissory Note (MPN).
Exit counseling is required for all students who have received a federal Direct Loan and who are expected to graduate or will not be attending Rollins at least half-time. An exit interview is your opportunity to review the amount of your loans and your rights and responsibilities in repaying these loans.
Borrower's Rights and Responsibilities
If you meet the eligibility requirements, you have a right to repayment deferments, which suspend principal loan payments for specified periods of time.
- Remember that the MPN certifies your loans for the maximum amount you are eligible to borrow. Because you may accrue debt with each year of your education, you should be certain that you need the full amount of your education loan each year. You can decline or reduce your loan amount each year.
- You are required to repay education loans, even if you do not finish your academic program or your academic program does not meet your expectations.
- You are responsible for notifying your school and lender if you have received student loans from more than one lender.
- You must use money received from education loans for education-related expenses only.
- You must notify your lender in writing of:
Name or address changes.
Failure to enroll at Rollins.
Failure to enroll on at least a half-time basis or for the loan period certified.
Withdrawal from school or reduction of attendance to less than half time.
Transfer from one school to another.
Graduation.
Federal regulations require Rollins to prorate a dependent or independent undergraduate student's annual federal Direct loan limits when you enroll in one semester and will graduate in the same academic year. Typically, this impacts students who will graduate at the end of the fall semester.
Loan Proration Formula
Number of enrolled credit hours / Number of credit hours in an academic year (24) X annual Direct loan limit
Loan Proration Example for Full-Time Enrollment
12 credits enrolled / 24 academic year credits X $5,500 Subsidized Loan = $2,750
12 credits enrolled / 24 academic year credits X $2,000 Unsubsidized Loan = $1,000
Loan Proration Example for Half-Time Enrollment
8 credits enrolled / 24 academic year credits X $5,500 Subsidized Loan = $1,815
8 credits enrolled / 24 academic year credits X $2,000 Unsubsidized Loan = $660