Factors To Consider When Borrowing
When you are trying to bridge the gap between your expenses, income, and other forms of aid, consider the following before deciding how much to borrow.
Loan Amount
Evaluate your In-school budget. You may not want to borrow the full amount for which you qualify. You should never borrower more than what you need.
Aggregate L oan Amount
Your total indebtedness may affect you future plans for furthering your education, such as pursuing a graduate degree or a second bachelor’s degree. Be conscious of your aggregate loan amount by checking your total Federal Stafford loan indebtedness at the Nation Student Loan Data System website. The aggregate loan limits are listed below:
| Direct AGGREGATE LOAN LIMITS - EFFECTIVE FOR DISBURSEMENTS ON AND AFTER 07/01/08 |
||||
|---|---|---|---|---|
| Academic Level | Dependent | Independent | ||
| Maximum Amount |
Maximum Subsidized Amount |
Maximum Total Amount |
Maximum Subsidized Amount |
|
| Undergraduate | $31,000 | $23,000 | $57,500 | $23,000 |
| Graduate | $138,500 | $65,500 | ||
Annual Loan Limit
Most loan programs have maximum annual loan limits. If you are planning to attend school in the summer, you may want to consider your annual federal loan limit when you decide how much to borrow for fall and/or spring semesters. You may want to set aside part of the annual limit to be applied toward your summer semester (provided you are eligible). The annual loan limits are listed below:
| Direct ANNUAL LOAN LIMITS - EFFECTIVE FOR DISBURSEMENTS ON AND AFTER 07/01/08 |
||||
|---|---|---|---|---|
| Academic Level | Dependent | Independent | ||
| Maximum Amount |
Maximum Subsidized Amount |
Maximum Total Amount |
Maximum Subsidized Amount |
|
| Freshman | $5,500 | $3,500 | $9,500 | $3,500 |
| Sophomore | $6,500 | $4,500 | $10,500 | $4,500 |
| Junior | $7,500 | $5,500 | $12,500 | $5,500 |
| Senior | $7,500 | $5,500 | $12,500 | $5,500 |
| Second Bachelor | $7,500 | $5,500 | $12,500 | $5,500 |
| Graduate | $20,500 | $8,500 | ||
Repayment Period
The Federal Direct Loan Program offers a variety of loan repayment options with repayment periods of 10-25 years. If you choose a shorter repayment period, you will pay less in interest charges. You can review your Federal Direct Lending repayment choices here.
Minimum Monthly Payment Amounts
Your minimum monthly student loan payment will depend on the total amount that you borrowed and the repayment plan that you choose. Most Direct loans require a minimum monthly payment of at least $50 while Perkins loans require a minimum monthly payment of at least $40. You can calculate your monthly payment for the standard repayment plan at the Direct Lending website.
Borrowers Rights and Responsibilities
Review and understand your rights and responsibilities for each loan program. Keep a copy of all paperwork associated with your loans for future reference.
Public Service Loan Forgiveness Options
Consider loan forgiveness options when deciding on your career plans. You may be able to have your debt excused after 10 years of making payments while employed in some public service careers through the Public Service Loan Forgiveness Program. Learn about more loan forgiveness options on our Loan Forgiveness page.