2014-2015 Walden University Student Handbook (March 2015) 
    
    Sep 26, 2021  
2014-2015 Walden University Student Handbook (March 2015) [ARCHIVED CATALOG]

Federal Direct Loans


Return to: Federal Programs  

Federal Direct Subsidized Loans are need-based loans available only to undergraduate students. The federal government pays the interest on this loan while the student is enrolled at least half time in school.

Students typically have a 6-month repayment grace period for all federal loans. A grace period is a period of time after borrowers graduate, leave school, or drop below half-time enrollment where they are not required to make payments on certain federal student loans. Some federal student loans will accrue interest during the grace period, and if the interest is unpaid, it will be added to the principal balance of the loan when the repayment period begins.

Federal Direct Unsubsidized Loans are available to undergraduate and graduate students. These loans are not based on need. Students are required to pay the accruing interest while enrolled in school, unless the students arrange to postpone the interest payment by checking the appropriate box indicated on the Master Promissory Note. Students should be careful when choosing this option: It means that the interest will be capitalized (the accrued interest will be added to the principal amount), increasing the amount of the debt. The interest rates for undergraduate subsidized and unsubsidized Direct Loans disbursed on or after July 1, 2013 through June 30, 2014 are fixed at 3.86%.

The interest rates for undergraduate subsidized and unsubsidized Direct Loans disbursed on or after July 1, 2014 through June 30, 2015 are fixed at 4.66%.

The interest rates for graduate unsubsidized Direct Loans disbursed on or after July 1, 2013 through June 30, 2014 are fixed at 5.41%.

The interest rates for graduate unsubsidized Direct Loans disbursed on or after July 1, 2014 through June 30, 2015 are fixed at 6.21%.

Both the subsidized and the unsubsidized Direct Loans disbursed on or after December 1, 2013 through September 30, 2014 have a 1.072% origination fee.

Both the subsidized and the unsubsidized Direct Loans disbursed on or after October 1, 2014 through November 30, 2015 have a 1.073% origination fee.

Creditworthiness is not a requirement to obtain a Direct Loan (subsidized or unsubsidized). Under this program, students may borrow up to their maximum annual loan limit every award year (i.e., 9 months for quarter-based, 12 months for semester-based programs). Loan funds can be used to cover direct education costs such as tuition, fees, and room and board, as well as indirect costs, such as books and other education-related expenses.

Federal Direct Loans borrowed while enrolled at another institution may impact a student’s loan eligibility at Walden University. Before any funds are disbursed, students must read important disclosure information regarding their student loan(s). The Disclosure Statement provides information about the Direct Subsidized Loan and/or Direct Unsubsidized Loan that Walden University plans to disburse (pay out) by crediting the student’s school account, paying the student directly, or both. There is also a Plain Language Disclosure that will explain the terms of the loan(s). Both disclosures are available at www.studentloans.gov. Students are encourages to keep a copy of all disclosures for their records.

All information submitted for the purpose of securing a federal student loan will be submitted to the National Student Loan Database (NSLDS) and accessible by authorized agencies, lenders, and institutions. The student loan borrower is responsible for knowing the total amount of federal loans borrowed. A summary of an individual’s federal loan debt is available via the NSLDS website (www.nslds.ed.gov/nslds_SA/).

On August 2, 2011, Congress passed the Budget Control Act of 2011, which put into place automatic federal budget cuts, known as a “sequester.”  To find out more information, please visit http://ifap.ed.gov/dpcletters/GEN1116.html.