Federal William D. Ford Direct Loan Program (Subsidized)
This subsidized program allows students who demonstrate federal financial need and who are enrolled for at least six credits each term to borrow up to $3,500 for the first year of undergraduate study, $4,500 for the second year, and $5,500 per year for subsequent undergraduate study. The interest rate is fixed at 3.4%. Interest does not accrue nor does repayment begin on subsidized Direct Loans until termination of college enrollment on at least a half-time basis. Interest accrued during in-school and the grace period is paid by the federal government. The standard repayment period is up to ten years. Subsidized Direct Loans carry a 1.0% federal origination fee. Net proceeds will equal approximately 99.0% of the loan amount. New borrowers must complete a Federal Direct Loan electronic master promissory note and complete an on-line Entrance Counseling to borrow funds through this program.
Federal William D. Ford Direct Loan Program (Unsubsidized)
This unsubsidized program allows all students regardless of federal financial need and who are enrolled for at least six credits per term to borrow up to $5,500 for the first year of undergraduate study, $6,500 for the second year, and $7,500 per year for subsequent undergraduate study less the amount of any subsidized Direct Loan received by the student. New borrowers must complete a Federal Direct Loan electronic master promissory note and complete an on-line Entrance Counseling to borrow funds through this program. The interest rate is fixed at 6.8% and the origination fee is the same as specified above under the description of the subsidized Direct Loan Program, however, interest accrual begins immediately during in-school and deferment periods. Interest accruing during these periods may be paid or capitalized.
Independent students may borrow up to an additional $6,000 per year for the first and second years of undergraduate study and up to an additional $7,000 per year for subsequent undergraduate study through the unsubsidized Direct Loan Program. Dependent students may borrow up to the same additional amounts through this program but only if the student’s parent is denied eligibility to borrow funds through the Federal PLUS Loan Program. Click here to visit the Federal Direct Loan Program Web site.
Alternative/Private Student Loans
Many banks and lending institutions offer alternative educational loans that can be used to cover the portion of the total cost of education not covered by scholarships, grants, and other financial aid. These loans are offered by private lenders and there are no federal forms to complete. Eligibility for these loans often depends on the credit score of the borrower.
Some families turn to alternative loans when the federal loans do not provide enough money or when they need more flexible payment options.
Because most private loans cost more than the education loans offered by the federal government, and most have variable interest rates tied to your credit score, we recommend that families research the various private loans before electing to use this payment option.
Washington College does not partner with any particular lenders. However, the Office of Student Aid staff would be happy to help answer questions you may have related to alternative/private loans. Students are encouraged to compare the terms and conditions of the various private loans before applying.