Federal Direct Loans
Federal Direct Loans (Subsidized/Unsubsidized)
Federal student loans are available to eligible students (U.S. citizens, permanent residents, and eligible non-citizens) who submit a Free Application for Federal Student Aid (FAFSA). These loans are available to qualifying full-time or part-time (6 credits) undergraduate and graduate students (Unsubsidized only) who are making Satisfactory Academic Progress (SAP) and are accepted into a degree-granting program (some graduate certificates are eligible too). Federal Direct Loans offer better options than private loans from banks. We encourage students to use federal loans before other private loans, which can carry costly fees and higher interest rates. See the loan Repayment Plans.
Learn more about the Federal Direct Subsidized/Unsubsidized loans.
Federal Direct Subsidized Loan
These are need-based low-interest loans from the U.S. Department of Education, administered by NJIT. Borrowers must demonstrate financial need after all other awards (grants, scholarships, and federal work-study) are considered. Because these are need-based loans (based on FAFSA), the government pays the interest while the student is enrolled at least half-time (6 credits). You must pay the principal and interest during the repayment period which occurs six months following graduation, or if you are enrolled less than half-time (<6 credits) or withdraw from the university. The federal government withholds an origination fee to defray the costs of administering the loan programs.
Federal Direct Unsubsidized Loan
These are non-need-based, low-interest loans from the U.S. Department of Education, administered by NJIT. Both undergraduate and graduate students may be eligible but must be enrolled at least half-time (6 credits). Payment is deferred as long as the student is enrolled at least half-time; after deferment, there is a six-month grace period. The borrower is responsible for the interest on these loans from the time the loan is disbursed. Students may choose to make loan payments while in school (recommended) or allow the interest to accumulate. The federal government withholds an origination fee to defray the costs of administering the loan programs.
Required Loan Documents
First-time borrowers must complete the following documents:
As a Federal Direct Loan borrower, before you graduate, or if you drop below less than half-time enrollment, you must complete:
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Exit Counseling discusses topics such as repayment options, grace periods, deferment, and more.
How Loan Amounts are Determined
The amount of federal loans offered is based on the following factors (see the chart below for details):
- Undergraduate or graduate student
- Grade level (freshman, sophomore, junior/senior)
- Dependency status
- Previous federal loan balances
Annual and Aggregate Federal Direct Loan Limits (Subsidized and Unsubsidized)
| Year | Dependent Students (except students whose parents are unable to obtain PLUS Loans) | Independent Students (and dependent undergraduate students whose parents are unable to obtain PLUS Loans) |
| First-Year Undergraduate Annual loan Limit |
$5,500 – No more than $3,500 of this amount may be in subsidized loans. | $9,500 – No more than $3,500 of this amount may be in subsidized loans. |
| Second-Year Undergraduate Annual loan Limit | $6,500 – No more than $4,500 of this amount may be in subsidized loans. | $10,500 – No more than $4,500 of this amount may be in subsidized loans. |
| Third-Year and Beyond Undergraduate Annual loan Limit | $7,500 – No more than $5,500 of this amount may be in subsidized loans. | $12,500 – No more than $5,500 of this amount may be in subsidized loans. |
| Graduate or Professional Students Annual Loan Limit | Not Applicable (all graduate and professional students are considered independent) | $20,500 (unsubsidized only) |
| Subsidized and Unsubsidized Aggregate Loan limit | $31,000 – No more than $23,000 of this amount may be in subsidized loans. | $57,500 for undergraduates – No more than $23,000 of this amount may be in subsidized loans. $138,500 for graduate or professional students – No more than $65,500 of this amount may be in subsidized loans. The graduate aggregate limit includes all federal loans received for undergraduate study. |
Public Service Loan Forgiveness
A new program established by the College Cost Reduction & Access Act offering loan forgiveness after 10-years of public service employment.
To qualify for loan forgiveness, a borrower must make qualifying monthly loan payments (120 payments) while working full-time in qualifying public service employment. For further information, view the Public Service Loan Forgiveness document.
Next Steps for Graduating Students
For important information and resources for graduating students, please visit here.