The Federal Direct Stafford Subsidized Loan is a need-based federal loan awarded to students who demonstrate financial need. Subsidized eligibility is always calculated for you prior to Unsubsidized, as it is the least expensive loan option available since you are not responsible for interest until you actively enter repayment. The US Department of Education pays the interest.
NEW: Limitation on Direct Subsidized loan eligibility for First-Time Borrowers on or after July 1, 2013. There is a limit on the maximum period of time (measured in academic years) that you can receive Direct Subsidized Loans. You may not receive Direct Subsidized Loans for more than 150 percent of the published length of your program. This is called your maximum eligibility period. Your maximum eligibility period is based on the published length of your current program.
For example, if you are enrolled in a four-year bachelor’s degree program, the maximum period for which you can receive Direct Subsidized Loans is six years (150 percent of 4 years=6 years). If you are enrolled in a two-year associate degree program, the maximum period for which you can receive Direct Subsidized Loans is three years (150 percent of 2 years=3 years).
After you have exhausted your maximum eligibility period, you are no longer eligible to received additional Direct Subsidized Loans. However, you may continue to receive Direct Unsubsidized Loans. Additional information is found at Federal Direct Stafford Subsidized Loans.
