Federal Direct Subsidized Loan

This is a federally financed and subsidized student loan made based on your financial need and other specific eligibility requirements. Undergraduate students may borrow up to the cost of attendance minus the expected family contribution and any other aid received. You may not borrow more than the maximum annual or aggregate amount. The federal government does not charge interest on these loans while you are enrolled at least half-time.

Changes in federal law have eliminated graduate student eligibility for Federal Direct Subsidized Loans. Graduate students may still be eligible for Federal Direct Unsubsidized Loans or a Federal Direct Graduate PLUS Loan. Loan limits remain the same, but interest begins accruing immediately on Federal Direct Unsubsidized Loans.

There is a time limit for Federal Direct Subsidized Loans. Subsidy is limited to 150% of the length of the educational program for Federal Direct Subsidized Loans that were disbursed on or after July 1, 2013, for students who have no outstanding balance of principle or interest—Direct Loan or FFELP—at the time of their disbursement. For example, if a student is enrolled in a four-year educational program, their eligibility limit for Federal Direct Subsidized Loans is six years.


  • Federally funded.
  • Need-based.
  • The fixed interest rate for loans in the deferment or six month grace period is as follows:

    Disbursement DateUndergraduate %Loan Origination Fee
    (originated Oct. 1 annually)
    July 1, 2022 - June 30, 20234.99%1.057%
    July 1, 2021 - June 30, 20223.73%1.057%
    July 1, 2020 - June 30, 20212.75%1.057%
    July 1, 2019 - June 30, 20204.53%1.059%
    July 1, 2018 - June 30, 20195.05%1.062%
    July 1, 2017 - June 30, 20184.45%1.066%
    July 1, 2016 - June 30, 20173.76%1.069%
    July 1, 2015 - June 30, 20164.29%1.068%
  • Effective July 1, 2013: Interest rates are adjusted yearly based on the 10-year U.S. Treasury note index rate. The interest rate cap for undergraduate Federal Direct Subsidized and Unsubsidized Loans is 8.25%.
  • Subject to annual and aggregate loan limits.
  • This is a loan you must repay to the U.S. Department of Education.
  • Complete the student financial aid adjustment form if you wish to cancel or reduce a loan that has not been disbursed to your WMU account. If the loan has already disbursed, you must complete the student financial aid adjustment form within 30 days of the date of disbursement. Please note that canceling or reducing a disbursed loan may result in a balance due on your WMU account.
  • After you have accepted your subsidized loan, you will receive a Federal Direct Loan Disclosure Statement from the Direct Loan Servicing Center or WMU. The disclosure statement identifies anticipated disbursement dates, gross and net disbursement amounts and loan fee amounts for all your federal loans for the academic year.


  • Completed Federal Master Promissory Note required for first-time borrowers.
  • Federal loan entrance counseling required for first-time borrowers at WMU.
  • Offer eligibility based upon expected family contribution, cost of attendance, enrollment and other resources.
  • Must be enrolled at least half-time. Offer will be canceled if enrolled less than half-time.
  • Offer may be adjusted or canceled if there is a change to estimated family contribution, cost of attendance, enrollment, graduating in August or December or if you receive additional resources.
  • Undergraduate or teacher certification.
  • Must be making satisfactory academic progress.
  • U.S. Citizen or eligible non-citizen.
  • Not in default on prior educational loans.


  • Repayment deferred while enrolled at least half-time.
  • You will begin to repay your loan six months after you cease to be enrolled at least half-time. During this six-month grace period, interest will not accrue on your loan.
  • Complete an exit counseling session so you are aware of all the information you will need to know about repaying your loan.
  • If you drop to less than half-time, withdraw, drop out, graduate or simply do not return to school, this information will be reported to the loan servicer and they will begin to count your grace period. You are responsible for notifying WMU immediately if your enrollment changes as described above.
  • Payments will be made to the U.S. Department of Education.
  • For detailed information about repayment, deferments, forbearance, forgiveness programs, consolidation and other frequently asked questions, visit studentaid.gov.
  • The interest rate for a direct consolidation loan is the weighted average of the interest rates on the loans being consolidated and is fixed for the life of the loan.
  • It is important that you maintain all important files and keep copies of your offer notices, Master Promissory Note, borrower's rights and responsibilities and the Loan Disclosure Statement in one place as they provide the details of your loans and your rights and responsibilities as a student loan recipient.