Loans – Federal Direct Loans for Undergraduate Students

The Federal Direct Subsidized and Unsubsidized Loans are low-interest loans designed to provide undergraduate and graduate students with additional funds for college. This loan may be Subsidized (based on need), Unsubsidized, or a combination of both. The interest rates for these loans are set by the Federal Government and are updated each July for the upcoming academic year.

Due to recent changes in Congress, loans disbursed on or after July 1, 2014 have the following interest rates:

The interest rate for Subsidized loans and Unsubsidized loans for undergraduate students for the 2015-2016 academic year is 4.29%.

The U.S. Department of Education will withhold an origination fee of one percent (1.073%) of the total loan amount for all Subsidized and Unsubsidized loans disbursed after October 1st, 2014.

Borrowers of these Federal Direct Loans have a six-month deferral (grace) period following graduation or withdrawal before entering repayment. If a student falls below half-time enrollment, the six-month deferral period will begin.

Currently, the Federal Government pays the interest that accrues during in-school and grace periods on the Direct Subsidized Loan. New Subsidized loans disbursed from July 1,2012 to June 30, 2014 will not be eligible for subsidized interest benefits during the six-month grace period after a student graduates or falls below half-time enrollment. Interest will accrue during the grace period and will be capitalized if unpaid by the borrower.

The Direct Unsubsidized Loan accumulates interest while the student is enrolled.

In order for us to process your Direct Loan, you must complete a three-step process:

  1. Sign and return requested paperwork. This includes the Direct Loan Response Form.
  2. Complete Entrance Counseling. 
    This is a twenty-minute online tutorial designed to acquaint first-time Direct borrowers with the rights and responsibilities for this educational loan.
    * If you have previously borrowed at Warren Wilson College through the Federal Direct Loan Program, you are not required to complete Entrance Counseling again. However, it is highly recommended that you do so!
  3. Complete a Master Promissory Note (MPN) with the Federal Department of Education.
    * If you have previously borrowed at Warren Wilson College through  the Federal Direct Loan Program, you will not need to complete a new MPN.