Federal Direct Subsidized Loans

Federal Direct Subsidized Loans are awarded to undergraduate students with financial need as determined by the FAFSA. The U.S. Department of Education pays the interest while you are in school at least-half-time in a degree granting program (6 credits at MSU). Graduate and Professional students are not eligible for subsidized loans.

The current fixed interest rate for undergraduate subsidized loans disbursed on or after July 1, 2017, is 4.45%, with a loan origination fee of 1.066%. Rates and fees are subject to change and current rates can be found at https://studentaid.ed.gov/sa/types/loans/interest-rates.

Repayment begins six months after you graduate, drop below half-time or withdrawal. Federal Direct Loans will be prorated for any undergraduate student who enrolls in only one semester and will graduate in that same term or academic year. The prorated amount is equal the number of credits enrolled in divided by 24 credits. Student should never take more credits then they need to graduate.

In general, you may not receive Direct Subsidized Loans for more than 150% of the published length of your program of study. For more information, please review the U.S. Department of Education's Federal Student Aid announcement concerning this time limitation.

To apply, complete and submit the Free Application for Federal Student Aid (FAFSA). Accept your loans in MyInfo. Complete Entrance Counseling and a Master Promissory Note (MPN) at studentloans.gov. The Entrance Counseling and MPN generally do not become available until May or June of the year preceding the fall enrollment.

Federal Direct Unsubsidized Loans

Federal Direct Unsubsidized Loans are not need-based and can be made to undergraduate and graduate students. Interest accrues beginning on the date the loan first disburses. Students may elect to pay the interest while enrolled in school or request to defer payment on the interest. If you defer the interest, it will be added (capitalized) to the principal.

The current fixed interest rate for unsubsidized loans disbursed on or after July 1, 2017, is 4.45% for undergraduates and 6.00% for graduate students. All loans will also incur a origination fee of 1.066%. Rates and fees are subject to change and current rates can be found at https://studentaid.ed.gov/sa/types/loans/interest-rates.

Repayment begins six months after you graduate, drop below half-time or withdrawal. Federal Direct Loans will be prorated for any undergraduate student who enrolls in only one semester and will graduate in that same term or academic year. The prorated amount is equal the number of credits enrolled in divided by 24 credits. Student should never take more credits then they need to graduate.

To apply, complete and submit the Free Application for Federal Student Aid (FAFSA). Accept your loans in MyInfo. Complete Entrance Counseling and a Master Promissory Note (MPN) at studentloans.gov. The Entrance Counseling and MPN generally do not become available until May or June of the year preceding the fall enrollment.

Federal Direct Loan Annual and Aggregate Limits

 

Year in School

Dependent

Independent (and dependent undergraduate students whose parents are unable to obtain PLUS Loans)

Freshman (0-29 earned credits)

$5,500 – No more than $3,500 may be subsidized.

$9,500 – No more than $3,500 may be subsidized.

Sophomore (30-59 earned credits)

$6,500 – No more than $4,500 may be subsidized.

$10,500 – No more than $4,500 may be subsidized.

Junior and Senior (60+ credits), Second Bachelors, and Certificate Programs (Teaching & Pre-Medical)

$7,500 – No more than $5,500 may be subsidized.

$12,500 – No more than $5,500 may be subsidized.

GRADUATE/PROFESSIONAL

 N/A

$20,500 unsubsidized only

 

 

 

Aggregate Limits

Subsidized

Total subsidized and Unsubsidized

Undergraduates

$31,000 – No more than $23,000 may be subsidized.

$57,500 – No more than $23,000 may be subsidized.

Graduate/Professional

 

$138,500

 

Federal Direct Graduate Plus Loans

Federal Direct Graduate PLUS Loans are awarded to graduate or professional students who are enrolled in at least half-time in a degree-seeking program. There is no annual loan limit for the Graduate PLUS Loans, but students cannot borrow in excess of their cost-of-attendance. Students who apply for Graduate PLUS Loans are subject to a credit check to evaluate creditworthiness. Before the Graduate PLUS Loan can be awarded, students must first apply for their maximum loan eligibility in Federal Direct Unsubsidized Loans. 

The current fixed interest rate for PLUS loans disbursed on or after July 1, 2017, is 7% with an origination fee of 4.264%. Rates and fees are subject to change and current rates can be found at https://studentaid.ed.gov/sa/types/loans/interest-rates.

To apply for the Graduate PLUS Loan, go to StudentLoans.gov and use your FSA ID to sign in, and then click on the Request PLUS Loan link. You must also complete a Graduate PLUS Master Promissory Note (MPN) and Graduate PLUS Entrance Counseling at the same Website.

Nursing Student Loans

Nursing Student Loan is a fixed low-interest (5%) loan for students with exceptional financial need. There is no loan fee. MSU awards Nursing Student Loans primarily from funds generated from former students repaying these loans.

For students that accept a Nursing Student Loan, a Promissory Note and other loan documents will be mailed to you each year you accept a Nursing Student Loan.

You will have a nine month grace period after you graduate, withdraw, leave school, or drop below half-time enrollment (less than six credits) before repayment of your Nursing Student Loan begins. At the end of your grace period, interest begins to accrue and you will have up to 10 years to repay the loan. There is never any penalty for prepaying on your loans. If you have any questions, please contact MSU's Nursing Loan Service Center at 406-994-2702.

If you accept a Nursing Student Loan and then withdraw from the Nursing Program, your Nursing Loan will be canceled and you will begin repayment immediately.

Alternative/Private Loans

Private loans are credit based and not awarded based on the results of your Free Application for Federal Student Aid (FAFSA). These loans should be considered only after for applying for federal based loans. These loans have different interest rates and repayment structures. MSU cannot direct you to or suggest a lender for you. However, we can help you make a request to a lender that you choose by providing some detailed information about lenders that previous students (families) have utilized. Please research a lender on your own or compare options at FASTChoice.

https://choice.fastproducts.org/FastChoice/home/253200/2

At Montana State University, we encourage students and families to make informed decisions about financial aid. We highly recommend that you borrow only the amount of loans you need to successfully complete your education.