Federal Direct Loans
The Federal Direct loan program allows eligible students to borrow funds directly from the Federal Government. Students must be enrolled at least half-time each term to be eligible. Direct Loans can be awarded as subsidized, unsubsidized, or both based on financial need and level of study.
- Subsidized Direct Loans are offered to undergraduate students based on financial need. Interest on the loan is subsidized by the Federal Government during the student’s enrollment and grace period.
- Unsubsidized Direct Loans are non-need-based loans offered to undergraduate and graduate students. Accrued interest is the responsibility of the student during enrollment and grace period.
- PLUS Direct Loans are available to parents of dependent undergraduate students or Graduate/professional students. While subsidized and unsubsidized direct loans have annual and aggregate limits, creditworthy borrowers may borrow a PLUS for up to the student’s cost of attendance minus estimated financial assistance. Prospective PLUS borrowers must complete the online PLUS Application at studentaid.gov. If the applicant is not approved for a PLUS due to adverse credit, they can obtain a creditworthy endorser (excluding the student for parent borrowers) to receive the loan. If approved, the borrower must complete a Direct PLUS Master Promissory Note (MPN), also at studentaid.gov.
Half-time status at University of Maryland Global Campus is defined differently depending on your program:
- Standard Undergraduate (6 credits)
- Standard Graduate (6 credits)
- Specialty Graduate (3 credits)
- Doctoral (3 credits)
Students can accept or decline the federal student loan offer. If loans are not accepted, they will be cancelled 30 days after being offered or after the start of the term, whichever is later.
Annual and Aggregate Loan Maximums
Direct Loan Annual Limits
The amount you can borrow annually depends on your grade level, as determined by your earned units.
| Grade Level | Earned Credits | Dependent Undergraduate Student | Independent Students |
| Freshman | 0–29 | $5,500—a maximum of $3,500 can be subsidized | $9,500—a maximum of $3,500 can be subsidized |
| Sophomore | 30–59 | $6,500—a maximum of $4,500 can be subsidized | $10,500—a maximum of $4,500 can be subsidized |
| Junior | 60–89 | $7,500—a maximum of $5,500 can be subsidized | $12,500—a maximum of $5,500 can be subsidized |
| Senior | 90+ | $7,500—a maximum of $5,500 can be subsidized | $12,500—a maximum of $5,500 can be subsidized |
| Graduate | N/A | N/A | $20,500 unsubsidized |
| Subsidized and Unsubsidized Aggregate Loan Limit | N/A | $31,000—no more than $23,000 of this amount may be in subsidized loans | $57,500 for undergraduates—no more than $23,000 of this amount may be in subsidized loans $138,500 for graduate or professional students—no more than $65,000 of this amount may be in subsidized loans (the graduate aggregate limit includes all federal loans received for undergraduate study) |
You are independent if you meet at least one of the following conditions:
Are 24 years of age of older;
Enrolled in a masters or doctorate program;
Legally married at the time you sign your FAFSA application;
Have children or other dependents who receive more than half of their support from you now and through June 30 of the year in which you receive financial aid;
Have legal dependents other than a spouse or children who receive more than half their support from you;
Are a foster child, or ward of the court after the age of 13;
Are a legally emancipated minor with documentation of the court judgment (emancipated minor is a formal legal status that must be declared in a court of law. Simply moving out of your parents’ household does not count. A judge must legally declare you emancipated. The court order must still be in effect when you file your FAFSA);
Are in legal guardianship as determined by a court;
Are homeless (Homeless is defined as lacking fixed, regular, adequate housing. This includes living in shelters, hotels, cars, etc.);
Are a veteran of the Armed Forces;
Are currently serving on active duty in the Armed Forces for other than training purposes.
Federal Direct Loan Award Changes
In accordance with Federal Regulations a student may:
- Make a reduction or cancel Federal Direct Loans that the student previously accepted. (Note: There are timeline
restrictions on when UMGC may reduce or cancel Federal Direct Loans that have disbursed to a student’s
account.) - Have Federal Direct Loans previously declined re-offered to the student’s account.
To request a reduction/cancellation of previously accepted Federal Direct Loans or to have previously declined Federal Direct Loans be re-offered the completed Change Form should be submitted to https://www.umgc.edu/help/submit-case.
The Cost of Borrowing
The loan origination fee percentages are as follows:
- 1.057% for Direct Subsidized and Direct Unsubsidized loans
- 4.228% for Direct PLUS loans (for both parent borrowers and graduate/professions student borrowers)
This fee, with proceeds to the U.S. Department of Education, will be deducted from each disbursement before it is credited to your university account.
The Interest Rate
| Loan type | Borrower type | Loans first disbursed on or after July 1, 2024 and before July 1, 2025 | Loans first disbursed on or after July 1, 2025 and before July 1, 2026 |
| Direct Subsidized Loans | Undergraduate | 6.53% | 6.39% |
| Direct Unsubsidized Loans | Undergraduate | 6.53% | 6.39% |
| Direct Unsubsidized Loans | Graduate or Professional | 8.08% | 7.94% |
| Direct PLUS Loan | Parent and Graduate or Professional | 9.08% | 8.94% |
All interest rates shown in the chart above are fixed rates that will not change for the life of the loan. Visit studentaid.gov for more information on Federal Direct student loan interest rates.
Entrance Loan Counseling
When you are a new borrower of a Federal Direct Student Loan at UMGC, you must complete an entrance loan counseling session so that you will know your rights and responsibilities as a borrower. The online session will take you about 20 minutes to complete. You will only need to complete this information once.
Promissory Note
Borrowing from the Direct Loan program requires the completion of an Electronic Master Promissory Note. While attending UMGC you can use the E-MPN for multiple loans over one or more academic years. You will only need to complete this information once.
Exit Loan Counseling
UMGC student borrowers who have taken out subsidized and unsubsidized Direct Loans, Grad PLUS loans, and/or Federal Consolidated loans must complete an online exit counseling session when they graduate, withdraw, or drop below half-time enrollment. Exit counseling helps borrowers understand their repayment plan options and their rights and responsibilities in the loan repayment process.
Log in with your Federal PIN or FSA ID to start the exit counseling process and then select "Complete Counseling" and "Exit Counseling."
Note: Exit counseling is not the same as the Financial Awareness Counseling (FAC) tool, which can be found on the same website. Using the FAC will not fulfill your exit counseling requirement, nor will taking a demo counseling session.
For further assistance, please consult the Direct Loan Exit Counseling Guide.
Repayment
You will begin to repay your loan at the end of a six-month grace period that begins when you graduate, leave school, or drop below half-time enrollment (6 credits). Learn more about loan repayment.
Student Loan Ombudsman
If you are interested in contacting the Student Loan Ombudsman, please see the information below.
Telephone: 877-557-2575
Fax: 606-396-4821
FSA Ombudsman Group
P.O. Box 1854
Monticello, KY 42633
For Washington State residents seeking information and resources about student loan repayment or seeking to submit a complaint relating to your student loans or student loan servicer, please visit the Washington Student Achievement Council's Student Loan Advocacy page or contact the Student Loan Advocate.