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Direct Unsubsidized Loan
Federal student loan offered by the U.S. Department of Education (ED) to help eligible students cover the cost of higher education. Find more information about Direct Unsubsidized Loans below.
Direct PLUS (Grad PLUS)
Federal Direct PLUS Loans are federal loans that graduate students can use to help pay for their degree. Find more information about Direct PLUS Loans, see the information listed under the heading Grad PLUS Loan below.
Private (Alternative) Loans
Private educational loans are available from a number of lenders for students whose cost of attendance has not been met with other financial aid. The FAFSA (Free Application for Federal Student Aid) is normally not required to apply for a private loan. Find more information about Private Loans, see the information listed under the heading Private (Alternative) Loans below.
Through the Office of Financial Aid, MSU provides short term loan options to students who are registered for the current semester and who can demonstrate the ability to repay within 60 days. Loans are usually granted in amounts up to $1,000 for graduate students. Find more information about Short-term Loans from MSU, see the information listed under the heading Short Term Loans below.
Although student loans are a convenient source of funding for your education, it is important to budget and borrow carefully.
Take very seriously the responsibility of borrowing and repaying an educational loan.
How conscientiously you make payments on your student loan will affect your ability to borrow for a car, a house, or other purchases in the future. If you are late with your student loan payments, it will have a negative effect on your credit history. On the other hand, repaying your student loan on time can help you establish and maintain an excellent credit history.
Preventing Default
Default is a legal term used when a borrower fails to repay a loan according to the terms of the signed promissory note. For a Federal Direct Student or Parent Loan, default occurs when the borrower fails to make a payment for 270 days under the normal repayment plan, and has not requested deferment of payment according to the Department of Education's standards.
Defaulting on a loan affects not only the borrower, but also the college or university as well as the US taxpayer. The borrower will experience negative consequences to his or her credit rating, garnishment of wages and collection from federal funds such as tax refunds or and even Social Security benefits.
If many borrowers at a particular college or university go into default status, the institution can lose the ability to participate in federal student aid programs, denying future students the ability to receive financial aid to help pay for college.
When borrowers default, the US government eventually must write off the loss, and passes the losses on to the taxpayer, either in the form of higher taxes, higher deficits, or the loss of other programs and benefits that the funds might have been used for instead.
Contact your lender(s) if you are having problems making your payments. You might qualify for a forbearance, which allows you to stop making payments for a time period while keeping your loans in good standing.
To be eligible for a Federal Direct Loan, you must meet the following criteria:
How to apply
The Direct Loan application is a three-step process. If you do not complete all three steps, your loan will not be processed.
Interest does accrue on an unsubsidized loan while you are in school. You may choose to pay interest while in school in order to avoid "paying interest on interest" (capitalizing interest).
Interest rates
The Direct Loan interest rate varies annually with a maximum rate of 8.25% for undergraduates and 9.5% for graduate students. The interest rate for graduate Direct Unsubsidized Loans disbursed on or after July 1, 2026 is 8.07%. Complete information about federal student loan rates and fees can be found on this page at studentaid.gov.
Direct Loans disbursed on or after October 1, 2020 require a 1.057% origination fee which is paid at the time of disbursement. Thus, 98.943% of the gross loan amount will be disbursed to your student account.
Repayment and consolidation
When you near graduation (or drop below half-time), you will be given information on loan repayment and consolidation. This is referred to as exit counseling (or "the exit interview"). For more information, see the tab on this page explaining loan repayment.
Federal Direct Loan programs carry both annual and cumulative (lifetime) limits. The FAFSA Submission Summary from your FAFSA contains your cumulative borrowing history, and you may also view your entire student loan history online via studentaid.gov.
| Maximum Subsidized + Unsubsidized | Maximum Subsidized | |
| Dependent Freshman | $5,500 | $3,500 |
| Dependent Sophomore | $6,500 | $4,500 |
| Dependent Junior/Senior | $7,500 | $5,500 |
| Independent Freshman | $9,500 | $3,500 |
| Independent Sophomore | $10,500 | $4,500 |
| Independent Junior/Senior | $12,500 | $5,500 |
| Graduate | $20,500 | $0 |
| Medical/Law | $50,000 | $0 |
| Maximum Subsidized + Unsubsidized | Maximum Subsidized | |
| Dependent Undergraduate | $31,000 | $23,000 |
| Independent Undergraduate | $57,500 | $23,000 |
| Graduate* | $100,000 | $65,500** |
| Professional* | $200,000 | $65,500** |
*The graduate/medical debt limits do not include loans received for undergraduate study.
**Graduate subsidized loans are no longer available as the federal government has ended the subsidized loan program for graduate students.
NOTE: If a student repays a portion of the student loan, then the aggregate amount is adjusted to reflect the outstanding principal balance owed on the loans.
| Maximum Perkins, Subsidized, Unsubsidized, Grad PLUS | |
| Lifetime Limit | $257,500 |
NOTE: If a student repays a portion of the student loan, the lifetime loan limit is not adjusted to reflect the outstanding principal balance owed on the loans.
If you qualify as a legacy student under the One Big Beautiful Bill, your annual and lifetime loan limits are different. Visit our page with loan limits page for legacy students for your loan limit information.
If you have had a federal loan disbursed in your current program prior to July 1, 2026 you may qualify for the Federal Graduate PLUS Loan under legacy provisions. Our website has information about loan guidelines under the One Big Beautiful Bill Act.
Eligibility
First, the student must have a FAFSA on file. Then you may borrow a Grad PLUS loan if:
How to apply
The Grad PLUS application is a multi-step process. If you do not complete each step, your loan will not be processed.
When to apply
You should begin the application process 4 to 6 weeks before you need the funds to ensure timely processing. Depending on the time of year, it may take several weeks for the servicer to send notice of your credit approval or rejection.
Applying for maximum
We suggest applying for the maximum amount available to you. You do not have to accept the full amount; you can choose how much you would like to accept in your student portal. If you would like to increase your requested amount later in the year, you can make the change in your portal. You do not apply for a new loan.
Disbursement & Refunds
Counseling
PLUS Counseling is required for borrowers who have an endorser listed on the loan or appeal an original credit decision.
Interest Rate
The interest rate for Grad PLUS Loans disbursed on or after July 1, 2026 is 9.07%. For more information on Grad PLUS Loans, including loan limits, interest rate, fees and more, visit studentaid.gov.
Alternatives if you are not approved
These are some options you may want to consider:
MSU Short Term Loans
MSU provides low-interest short term loans (7% per year). Loans are usually granted in amounts up to:
Short term loans are available to students who are registered for the current semester and who can demonstrate the ability to repay within 60 days.
Apply for a Short Term Loan at student.msu.edu. Visit your Student Accounts tile and choose "Short-Term Loans" from the "MSU Loans" option in the left-hand menu. Select the Short Term Loan application from the "Loans" menu at the top right. If you meet the criteria, you will be instantly approved and have your funds direct deposited into your bank account.
COGS Loans
The Council of Graduate Students (COGS) offers interest-free 60-day loans up to $500 to MSU graduate students. Please visit the Spartan One-Stop in the Hannah Administration Building, Room 140, to apply for a COGS loan. Loans are administered solely by the Office of Financial Aid and are subject to the availability of funds and the applicant meeting fund qualifications.
ASMSU Loans
Associated Students of Michigan State University (ASMSU) offers interest-free loans up to $300 through the 6th week of each semester (available to both undergraduate and graduate students). For more information, visit the ASMSU website.
Repayment
MSU loans not paid by the due date result in a late fee and a hold on the student's account that prevents a student from enrolling or registering for classes. The student must repay the loan in order to have the hold removed.
Payment options
Students may prepay all or any part of the loan at any time without penalty. There are three payment options available:
Private educational loans are available from a number of lenders for students whose cost of attendance has not been met with other financial aid. The FAFSA (Free Application for Federal Student Aid) is normally not required to apply for a private loan.
Private loan programs differ from federal student loans or PLUS loans in several ways:
Michigan State University has partnered with ELMSelect to offer a tool that will help students and families. ELMSelect has collected all private lenders used by MSU students in the past five years. The tool allows you to select lenders that specialize in your area of study, and to compare rates and conditions in order to select the loan product that best fits your need.
When can I apply for a loan?
You should begin the application process 4 to 6 weeks before you need the funds to ensure timely processing.
When will the loan be disbursed to my MSU Student Account?
Disbursement of funds depends on when the loan is approved. MSU policy is to disburse no earlier than 10 days prior to the student's first day of class in a semester or summer subterm. If that date has passed and the approval process has been completed, MSU will generally disburse the funds within 2 days of receiving the funds from the lender.
Use the ELMSelect comparison tool to find out when repayment begins on your loan, the interest rate, and any other fees.
Before federal loan money can be disbursed, the borrower must sign a Master Promissory Note (MPN). Once signed, the note is good for multiple years (with a few exceptions). If you have any questions, please feel free to contact us.
Federal Direct Loans
The MPNs for the following loans are available at studentaid.gov:
Be sure to correctly specify the type of loan you are signing for, as signing for the wrong loan will delay processing. If you have both subsidized and unsubsidized Direct Loans, you only need to complete one Direct Loan MPN.
Perkins Loan and Health Profession Loans
If you would like to view a previously signed Perkins Loan Promissory Note or Health Profession Loan Promissory Note, please visit controller.msu.edu/receivables/loans-receivables for additional information.
Loan Exit Counseling (The Exit Interview)
When you are prepared to graduate from MSU, we will invite you to participate in Loan Exit Counseling, which you can do in person, by mail, or on the Internet. Loan counseling provides information on what to expect as you begin repaying your loans.
Who to contact after you graduate or leave MSU
Repayment Plans
Options for repayment of federal loans are discussed here.
Loan Forgiveness Programs
Under certain circumstances, the federal government will cancel all or part of an educational loan. This practice is called loan forgiveness or loan cancellation.
Loan Consolidation
A Direct Consolidation Loan allows you to consolidate multiple federal student loans into one loan at no cost to you.” For more information, visit studentaid.gov's loan consolidation page.
Financial Hardship, Deferment, Forbearance, Default
If you are unable to make your student loan payments, there are deferment and forbearance options available. The consequences of defaulting on your student loans are severe, so explore your options BEFORE you default.
More info from the Department of Education on repaying your loans
General information about summer sessions can be found on MSU's Summer Study website.
There is no separate summer application. Students will be processed for summer financial aid based on actual summer enrollment. Students with a FAFSA application for the current aid year will be considered for available financial aid.
Students must be admitted into an aid eligible program to receive summer aid.
A separate application is necessary to receive a summer Grad PLUS loan. Visit Studentaid.gov to apply for your summer Grad PLUS loan. Pay attention to the choices of dates for your loan, and choose the date range that corresponds most closely with summer term.
If you are planning to study abroad during the summer, contact the Office of Financial Aid about possibly adjusting your budget to account for expenses.
Summer enrollment periods vary throughout the session, since a course may last a few days or the entire summer. Summer aid disbursement cannot occur until 10 days prior to your first day of summer classes.
Students should finalize their schedules before their first day of class. Dropping courses after starting a course may result in a financial aid bill.
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