Direct and Alternative Loans | Cleary University

Home » Direct and Alternative Loans

Direct and Alternative Loans

William D. Ford Federal Direct Loans

Low-interest loans for students and parents are available to help pay for the cost of a student’s
education. The lender is the U.S. Department of Education rather than a bank or other financial
institution. Interested students must complete the Free Application for Federal Student Aid (FAFSA)
and a Master Promissory Note (MPN). Several types of William D. Ford Federal Direct Loans are

  • Direct Subsidized and Unsubsidized Loans – Direct subsidized loans are for students with
    financial need, as determined by filing the FAFSA form. No interest is charged on a direct
    subsidized loan while enrolled in a degree-seeking program, registered at least half-time, and
    during grace and deferment periods. Direct unsubsidized loans are not based on financial
    need, hence interest is charged during all periods on an unsubsidized loan.
  • Direct PLUS Loans – Direct PLUS loans are low-interest loans available to parents of
    dependent students or for graduate students in need of additional funding to help pay for the
    student’s educational expenses. Interest is charged on the Direct PLUS loan during all
  • Direct Consolidation Loans – Direct Consolidation loans are loans for borrowers who have
    completed their studies and want to combine different eligible federal student loans into one
    Direct Consolidation loan.

The following charts provide the maximum annual and lifetime loan amounts that can be borrowed
through the William D. Ford Federal Direct Loan program.


Dependent Student Annual Amount Subsidized + Unsubsidized Total
Freshman (0-29 credits) $3,500 + $2,000* $5,500*
Sophomore (30-59 credits) $4,500 + $2,000* $6,500*
Junior/Senior (60+ credits) $5,000 + $2,000* $7,500*
Independent Student AnnualAmount Subsidized + Unsubsidized Total
Freshman (0-29 credits) $3,500 + $6,000* $9,500)
Sophomore (30-59 credits) $4,500 + $6,000* $10,500*
Junior/ Senior (60+ credits) $5,500 + $7,000* $12,500*
Graduate Student $20,500 Unsubsidized only* $20,500*
Alternative Loans

Private alternative loans are educational loans available to help students cover additional educational
expenses over and above what regular financial aid may not cover. Students should always apply for
federal financial aid by filing the Free Application for Federal Student Aid and taking out low interest
Federal Direct (Title IV) loans first before considering taking out alternative loans. Title IV loans may
be more favorable than the terms and conditions of private alternative loans.

Due to federal regulations and a changing credit market, the University is unable to provide loan
vendor recommendations. Students may wish to consult with their own banking institution as well as
to investigate other options to compare rates and benefits best suited to their individual needs.

Comments are closed.