Federal Loans

Investing in your future

A loan is a form of financial aid that you will have to repay even if you don’t finish your schooling. Loans are an investment in your education, but loan debt can add up quickly for you (or your parents). Borrow only what you truly need to cover your costs.

For all loans, you must meet these eligibility criteria:

  • Be a U.S. citizen, U.S. national, or permanent resident of the United States
  • Be enrolled half-time and admitted to a degree-seeking program
  • Meet satisfactory academic progress requirements
  • Not be in default on prior educational loans

Remember, you’re required to repay loans even if you do not finish your academic program or your program doesn’t meet your expectations.

How much debt can you afford?

Remember, just because loans are available to you doesn’t mean you should borrow the maximum.

When it comes to total student loans, aim to borrow no more than your anticipated first-year salary.

How to keep costs low

Keep track of your loans

Repaying loans

Prepare for your future. Learn about what to expect when it's time to repay your loans.

Repaying your loans

Your initial student aid eligibility (loans and grants) will be listed in your Student Aid Report. You will be able to accept, reduce, or decline loan offers when you receive your complete financial aid package from IU East (or your chosen school).

A direct subsidized loan is named as such because it is subsidized by the Department of Education to reduce the burden of your financial need and make college more affordable. The Department of Education pays the interest that accrues on your loans while you're enrolled in college at least half time, during the six months after you leave school (the "grace period"), and during any approved deferment periods.

  • Available to: Undergraduate students who demonstrate financial need.
  • Time limit: up to 150 percent of the published length of your chosen program. For example, if you’re enrolled in a four-year bachelor’s degree program, you can receive Direct Subsidized Loans for no more than six years. There are certain situations where you’ll become responsible for paying interest on the loan.

A direct unsubsidized loan is more like a traditional loan, in that you are responsible for all interest accrued on the loan. It's recommended that you pay the interest while you're in school, but if that is not possible, it will be added to the total amount owed.  You'll begin making payments six months after you leave school or drop below half time status.

  • Available to: Undergraduate and graduate students (no need to demonstrate financial need).

If you’re borrowing a Federal Direct Subsidized or Unsubsidized Loan for the first time, or it's been over 10 years since you completed the following, you must:

  • go through online Entrance Counseling
  • complete a Master Promissory Note (MPN)

You'll be prompted to complete these steps after receiving your Financial Aid Award Notification.

Entrance counseling will help you understand the federal loans you’re borrowing and the options you’ll have to repay them. You must complete the counseling before loan funds will be credited to your account.

You will need your FSA ID to log into your entrance counseling session.

The Master Promissory Note (MPN) is a legal document that explains the terms and conditions of your student loan. On your MPN, you promise to repay your loans and any interest and fees. You must sign it before loan funds will be credited to your account.

To sign your MPN, you’ll need:

  • Your FSA ID
  • Your Social Security number
  • Your driver’s license number
  • Your permanent address and telephone number
  • Information for two references, including their addresses and telephone numbers.

To sign the MPN, use your FSA ID to log into your direct loan account and select “Complete MPN.”

You’ll begin repaying your loans six months after you graduate or drop below half-time status. First, you’ll be asked to complete exit counseling, which will provide you with information on repaying your loans. We’ll send you email with the details when it’s time for you to go through exit counseling.

Learn more about repaying your loans