Federal Direct Loans

Federal Direct Loans are low-interest loans provided by the federal government that can help you pay your college expenses.

There are two types of Federal Direct Loans for students:

  • SUBSIDIZED Federal Direct Loans are based on financial need which is determined by completing the Free Application for Federal Student Aid. A loan is “subsidized” when the government pays the interest for the student while the student is enrolled in school at least half time, for the first six months after you leave school (referred to as a grace period*) and during periods of authorized deferment.

*Note:  If you received a Direct Subsidized Loan that was first disbursed between July 1, 2012, and July 1, 2014, you will be responsible for paying any interest that accrues during your grace period.  If you choose not to pay the interest that accrues during your grace period, the interest will be added to your principal balance.

  • UNSUBSIDIZED Federal Direct Loans are not based on financial need. This loan is not subsidized by the government. The student is responsible for all interest that accrues during in-school, grace and deferment periods. Students may choose to make interest payments while in school or may defer (and accumulate) the interest until repayment.

Further details regarding the Direct Loan Program may be obtained from Federal Student Aid.

Students must enroll in a MINIMUM of six Title IV eligible credits each semester

Students must do this in order to receive loan funding and use loan money for educational expenses for attendance at Jackson College (JC). Your loan application will be processed based on our institutional cost of attendance. A class that has previously been attempted twice will not count toward your six Title IV eligible credit hours. If you drop below six Title IV eligible credit hours, your future loan disbursement(s) will be cancelled. If you withdraw from your class(es), you may be subject to having to repay a portion of your loan funds immediately to JC. The amount you have to repay will be determined in accordance to the U.S. Department of Education’s Return of Title IV Funds policy.

Students must be in good academic standing

Students must be making satisfactory academic progress towards completing their JC degree or certificate program. Good academic standing means maintaining a minimum cumulative grade point average of 2.0. Satisfactory academic progress toward completion of a course of study means completion of 67 percent (%) of all attempted credits.  Students not meeting the satisfactory academic progress standards will be given one semester on an academic warning status.  Students may receive financial aid, including loans, during their academic warning semester.  Students that have reached their credit hour limit or have been suspended from Federal financial aid will not be eligible for loans.

Important Information

JC is concerned about the high debt level of our students. All Federal Direct Subsidized and Unsubsidized Loans are based on a standard institutional budget. Federal Direct Loans are intended to be used for direct educational expenses including tuition, fees, student room and board, books and transportation. You may not be eligible to borrow the maximum amount. Loan funds cannot be used to pay for non-education expenses.

Additionally, your actual loan amount is based on your loan period and other financial aid/educational resources you receive during the loan period. If you are applying for a loan for one semester of attendance at JC, your loan amount will not exceed half of your annual loan limit. One semester loans will also have two disbursement dates. You must be enrolled in a minimum of 6 credit hours to receive any loan funds. You will automatically be considered for subsidized loan funds first.

Original loans will only be processed for the fall and spring semesters. You will receive an email at your JC e-mail account when your award has been determined. You may reduce the amount of your loan after you accept your loan through JetStream. Loan requests for summer will be available in mid-March. You will only be eligible for a summer loan if you have not received the maximum amount during the fall and spring semesters. (See chart below.)

Maximum Annual Borrowing Limits for the Entire Academic Year
(Fall, Spring & Summer)


Student Status Subsidized Total
(Subsidized + Unsubsidized)
Freshman (0-23 credits) $3,500 $5,500
Sophomore (24+ credits) $4,500 $6,500


Student Status Subsidized Total
(Subsidized + Unsubsidized)
Freshman (0-23 credits) $3,500 $9,500
Sophomore (24+ credits) $4,500 $10,500

If you change from a freshman status to a sophomore status during the academic year, your maximum eligibility is the total for the sophomore status.

The U.S. Department of Education will deduct fees from the approved amount of your loan before the funds are sent to JC. (See charts below)


Loan Type First Disbursement Date Origination Fee
Direct Subsidized & Unsubsidized 10/01/22 – 09/30/24 1.057%
Direct PLUS 10/01/22 – 09/30/24 4.228%


Loan Type First Disbursement Date Fixed Interest Rate
Direct Subsidized & Unsubsidized 07/01/23 – 06/30/24 5.50%
Direct PLUS 07/01/23 – 06/30/24 8.05%
Direct Subsidized & Unsubsidized 07/01/24 – 06/30/25 6.53%
Direct PLUS 07/01/24 – 06/30/25 9.08%

(Standard Repayment)

Debt When Loan Enters Repayment Per Month* Total
$5,000 $58 $6,904
$10,000 $115 $13,809
$25,000 $288 $34,524
$50,000 $575 $69,048
$100,000 $1,151 $138,096

*Payments were calculated using a fixed interest rate of 6.8% for loans disbursed on or after July 1, 2006.

Federal Direct and PLUS Loan information will be submitted to the National Student Loan Data System (NSLDS) and will be accessible by guaranty agencies, lenders and institutions determined to be authorized users of the data system.