Federal Direct Loans
The William D. Ford Federal Direct Loan Program offers low-interest loans to help students pay for their higher education. These loans come from the U.S. Department of Education and must be repaid with interest, even if students don’t finish school or find a job after graduation. Lake Land College provides three types of loans to support students.
We recommend that you explore all other financing options before considering a student loan. Use a loan only as a “last resort” and only borrow what you truly need. Lake Land College is a low-cost institution, and we want to help you keep your student loan debt as low as possible when you graduate or transfer to a four-year college.
To determine if a student is eligible for Direct Loans, they must complete a Student Loan Request form on their Laker HUB by the term’s deadline. Parents can apply for PLUS loans at studentaid.gov.
Typically, the deadline to apply for a student loan is one week before the end of the semester.
A student must meet all general eligibility criteria. However, students cannot be considered for Direct Loans under the following conditions:
- They are currently in default on a federal student loan.
- They owe money due to an overpayment of a federal student grant.
- They exceed the annual and/or aggregate loan limits.
- They have excessive loan debt from Lake Land College or any other institution.
To receive loan funds, first-time borrowers at Lake Land College must visit studentaid.gov to:
- Complete Entrance Counseling to understand their obligation to repay the loan.
- Complete the Master Promissory Note (MPN), which agrees to the loan terms.
Direct Loan amounts awarded are determined by the institution. Lake Land will use the student’s request as a guide to ensure the student receives the best and most appropriate award package.
The amount of loans awarded to a student will not exceed the annual or aggregate loan limits. The total annual combined student Direct Loan award for a dependent Freshman is $5,500 and for a dependent Sophomore is $6,500.
For dependent students, the aggregate loan limit is up to $23,000 in subsidized loans, with a maximum combined total of $31,000. For independent students, as well as dependent students whose parents cannot obtain a PLUS loan, the aggregate loan limit is also $23,000 in subsidized loans, but the maximum combined total is $57,500.
At the time of loan disbursement, the Lake Land College confirms that the student is still enrolled at least half-time, has completed the entrance counseling requirement, and has a valid, linked Master Promissory Note (MPN).
Loans are disbursed in two payments: the first payment is made 30 days after the beginning of the Fall semester, and the second payment is made 30 days after the beginning of the Spring semester. For single-term loans, disbursements also happen in two payments; the first half is given 30 days after the first day of classes, followed by the second half 30 days later.
The loan amount applied to the student’s tuition and fees bill will be reduced by the origination fee. Any remaining loan funds after the bill is paid will be refunded to the student.
Parents may request to receive any remaining PLUS loan funds as a refund directly to them during the application process.
When a student graduates or drops to less than half-time attendance, they must complete exit loan counseling. This session will explain the repayment plan, show the monthly payment amounts, describe options for deferment and forbearance, and highlight the serious risks of defaulting on a federal student loan.
Students can complete the online exit counseling at studentaid.gov.
Direct Subsidized Loans
Direct Subsidized Loans are available to undergraduate students who demonstrate financial need. The amount a student can borrow is determined by the school and may not exceed their unmet financial need. The Department of Education covers the interest while students are enrolled at least half-time, for six months after they graduate, leave school, or drop below half-time enrollment, and during periods of deferment.
Repayment generally begins approximately six months after a student graduates, leaves school, or drops below half-time enrollment. For loans disbursed on or after July 1, 2024, the interest rate is 6.53% and remains fixed for the life of the loan. Additionally, an origination fee of 1.057% applies to loans disbursed before September 30, 2026.
Direct Unsubsidized Loans
Direct Unsubsidized Loans are available to undergraduate students who may not have financial need, as determined by the Student Aid Index and the cost of attendance. The amount a student can borrow is determined by the school, taking into account the cost of attendance and any other financial aid or resources.
The student is responsible for paying the interest during all periods. If the student chooses not to pay the interest while in school or during any non-payment periods (such as grace, deferment, or forbearance), the interest will be capitalized, which means it will be added to the principal balance of the loan.
Repayment begins approximately six months after the student graduates, leaves school, or drops below half-time enrollment. For loans disbursed on or after July 1, 2024, the interest rate is fixed at 6.53% for the life of the loan. Additionally, an origination fee of 1.057% applies to loans disbursed before September 30, 2026.
Direct PLUS loans
Direct PLUS Loans are available to eligible parents of dependent students. Parents must apply for the loan at studentaid.gov and should not have an adverse credit history. The amount a parent can borrow is based on the cost of attendance determined by Lake Land College, minus any other financial aid and resources received by the student.
Repayment begins immediately. However, parents may have the option to defer payments until approximately six months after the student graduates, leaves school, or drops below half-time enrollment.
For loans disbursed on or after July 1, 2024, the interest rate is 9.08%, fixed for the life of the loan. An origination fee of 4.228% applies to loans disbursed before September 30, 2026.