Federal Direct Loan Program

The Direct Loan Program has low interest loans that undergraduates, graduates and parents of dependent students may obtain from the Department of Education. This program includes the Federal Subsidized Stafford Loan, the Federal Unsubsidized Stafford Loan and the Federal PLUS Loan. These loan programs were created by Congress to help all eligible students and parents, with and without financial need, pay for the student's educational expenses.

Subsidized Loans

There are two types of Federal Direct Loans, subsidized and unsubsidized. Subsidized Loans are awarded on the basis of financial need. Financial need is determined by subtracting the Estimated Family Contribution (EFC), provided from the FAFSA, from the cost of attendance. If your financial need is not fully met through other forms of aid (including grants and scholarships), you are eligible for Subsidized Loan funds up to the remaining amount of your financial need or up to the loan limits based on your grade level, whichever amount is lower. The Federal Government will pay interest on a subsidized loan while you are in school and during your six-month grace period.

Unsubsidized Loans

If you do not demonstrate financial need, you are eligible for a Federal Unsubsidized Direct Loan. If you accept the Unsubsidized Loan, interest will accrue while you are enrolled. You have the option of paying the interest while you are enrolled.

Loan Limits

Freshmen $5,500
Sophomores $6,500
Juniors $7,500
Seniors/5th Year $7,500
Graduate Students $20,500




Independent students and students whose parents were denied for a PLUS loan are eligible for additional funding through the Federal Unsubsidized Direct Loan program.

Interest Rates**

Current interest rates on all Federal Direct Loans are fixed. Undergraduates receive different interest rates for subsidized and unsubsidized loans; rates for grad students are the same whether the loan is subsidized or unsubsidized.

Subsidized 4.29%
Unsubsidized 4.29%
Unsubsidized 5.84%
PLUS Loans  
Parent PLUS 6.84%
Graduate PLUS 6.84%

**Interest rates for loans effective July 1, 2015 - June 30, 2016

Origination Fees

An origination fee is charged by the Federal Government for Direct Loans. This fee is a percentage of the total loan amount and is deducted from each loan disbursement. You are responsible for repaying the entire amount you borrow. 

Direct Subsidized Loan &
Direct Unsubsidized Loan
On or after 12/1/13 and before 10/1/14 1.072%
On or after 10/1/14 and before 10/1/15 1.073%

Direct PLUS Loans

On or after 12/1/13 and before 10/1/14


On or after 10/1/14 and before 10/1/15 4.292%

Perkins Loan

The Federal Perkins Loan is a "need based", revolving loan fund utilizing both federal and institutional funds. This award is a loan and must be repaid by the borrower. The interest rate is 5.0%, with interest and principal repayments deferred until 9 months after the student graduates or ceases at least half-time enrollment. Funding for the Perkins Loan is limited. 

Graduate PLUS Loans

The Federal Graduate PLUS Loan program allows graduate and professional students to borrow at a lower fixed interest rate after the unsubsidized loan eligibility has been exhasted. The Federal Graduate PLUS Loan can be used to pay for the total cost of attendance minus any financial aid you've been awarded. The Graduate PLUS Loan is largely dependent on the borrower's credit rating and history. Graduate students must complete a Grad PLUS Loan application at

Federal Direct Parent PLUS Loan

Biological or adoptive parents of a dependent undergraduate student may apply for a Federal Direct PLUS loan to help meet the student's cost of attendance not covered by other financial aid. The Free Application for Federal Student Aid (FAFSA) is required and parents must complete a parent PLUS Loan application at

Credit History

Parents are also required to pass a credit check when they are applying for the PLUS loan. If a parent's application for a PLUS loan is denied based on the borrower's credit history, the student may become eligible for an additional unsubsidized student loan. Freshmen and sophomore students can borrow up to $4000 in a Federal Direct loan, while juniors and seniors could borrow up to $5000.

PLUS Loan Entrance Counseling - *New Requirement*

  • In January 2015, the Department of Education implemented changes to the adverse credit history provisions for the determination of an applicant's eligibility for a Direct PLUS Loan.
  • Parent and Graduate PLUS loan applicants who qualify for a Direct PLUS Loan by obtaining an endorser or due to a credit appeal decision, are now required to complete PLUS Loan Counseling. Applicants who are subject to the new counseling requirement must complete the counseling at

PLUS Loan Application Process

UNC Charlotte has recently streamlined the Parent and Graduate PLUS Loan application process. Effective Summer 2015, a paper application is no longer required. Parents and graduate students should apply directly on the website

  • Parents and Students first must fill out and submit the FAFSA.
  • Log into Starting April 2015, you will be prompted to obtain a FSA User ID and password which will replace your federal PIN. PLUS Parent Loan borrowers must sign in using their FSA User ID and not the student's.
  • Select Request PLUS Loan from the menu on the left.
  • Follow the steps to complete PLUS Loan application.
  • Complete the School and Loan Information Section.
  • Indicate the specific amount you wish to borrow. Note: "The Office of Financial Aid cannot process a PLUS Loan application if no amount is provided or "maximum" is entered. If you do not know the amount you want to borrow, save the application and contact our office to help determine the amount.
  • Select the Loan Period for the PLUS Loan.
  • Complete all sections of the Borrower Information.
  • The Department of Education will evaluate your credit and approve or deny the application. You will receive an immediate response.
  • If your credit is approved, you will be given instructions for completing a PLUS Loan Master Promissory Note (MPN) on, if you have not already completed one in the prior year. 
  • The Federal Direct Loan program will forward the approved PLUS Loan application to the Financial Aid Office to verify enrollment and eligibility. Please be aware it may take up to 48 hours for UNC Charlotte to receive your submitted application.
  • The federal governement will send the "Notice of Loan Guarantee and Disclosure Statement" to you the borrower.
  • The federal government will send loan disbursements to UNC Charlotte in accordance with the disclosure statement schedule.
  • If there are remaining funds available after University charges are paid, you can have these funds sent to you or your student for parent PLUS Loans.

If the PLUS Loan is credit denied, you may choose to obtain an endorser or provide docmentation to the Department of Education to appeal the credit decision. Contact the Department of Education at 800-557-7394 to start the appeal or get detailed information regarding the endorser addendum.