928-523-4951
financial.aid@nau.eduDirect loans for NAU students
What they are and how to get them
Direct loans are offered directly from the federal government and are meant to help students pay for college. These are the most common type of student loans. Direct loans generally have more favorable terms and conditions than private loans. We recommend using direct loans when possible over private loans.
There are two types of direct loans:
Subsidized loans
Subsidized loans means you won’t be charged interest on the loan while you’re still attending school at least half-time (6+ credits for undergraduate students). Students must demonstrate financial need to be eligible for subsidized loans.
Unsubsidized loans
Unsubsidized loans are available to all undergraduate and graduate students, regardless of financial need. You’re responsible for paying the interest on unsubsidized loans even while you’re still in college.
Tools and resources
- Entrance counseling: to accept a federal direct loan, you must complete entrance counseling, which will help you understand your loan and how it works. You’ll also need to sign a Master Promissory Note, which is an agreement to repay your loans and their interest.
- Federal Student Aid is an excellent website to learn more about all things federal financial aid.
- Interest rates on federal direct loans are set by Congress each year.
- Loan repayment and consolidation: learn more about the process and the best methods for paying off your student loans.
Loan limits
The amount of federal direct loans you can receive is based on what year you are in college as well as whether you are considered a dependent of a parent or guardian. If either of these things change in the middle of the school year, it could allow for additional loan funding.
| Academic level | Dependent students | Independent students |
| Freshman – <30 units completed | $5,500 Sub and Unsub $3,500 maximum Sub | $9,500 Sub and Unsub $3,500 maximum Sub |
| Sophomore – between 30 and 59 units completed | $6,500 Sub and Unsub $4,500 maximum Sub | $10,500 Sub and Unsub $4,500 maximum Sub |
| Junior / Senior – 60 units and above completed | $7,500 Sub and Unsub $5,500 maximum Sub | $12,500 Sub and Unsub $5,500 maximum Sub |
| Undergraduate second degree or teacher certification | $7,500 Sub and Unsub $5,500 maximum Sub | $12,500 Sub and Unsub $5,500 maximum Sub |
| Graduate degree or teacher certification | Not Eligible | $20,500 Unsub only |
| Student type | Lifetime loan limits, effective 7/1/2008 |
| Dependent undergraduate | $31,000 (Sub and Unsub) – $23,000 maximum Sub |
| Independent undergraduate | $57,500 (Sub and Unsub) – $23,000 maximum Sub |
| Graduate or professional | $138,500 (Sub and Unsub) – $65,500 maximum Sub |