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Alert: Your Federal Direct Loan subsidies are time limited

Hutchins Hall, U-M campus

Subsidies are limited for first-time and new Federal Direct Subsidized Loan borrowers. This federal regulation took effect on July 1, 2013 and affects all new borrowers from that point forward.  If you reach 150 percent of your degree program (for example, attending 6 years for a 4-year program) you will:

  • Not be eligible for additional Direct Subsidized Loans (though you may borrow a Direct Unsubsidized Loan) and
  • Be responsible for interest accrued on all loans from that point forward

New  borrowers are students with no outstanding federal loan principal balance when they take out a new loan. U-M will track a student’s progress in their program to determine whether they continue to be eligible for subsidized federal Direct Loans.  See this federal interactive information sheet which may offer more information: https://umich.box.com/v/DLsubsidy.

Students are encouraged to complete their degree program within the suggested timetable to avoid losing their federal loan subsidies.  Because this is a federal regulation, there is not an appeals process. Our staff is available to discuss your individual situation or any questions you may have about financial aid.  See our contact information and office hours.