Educational loans provide an excellent source of financial assistance.  Once all sources of gift aid have been explored, you and your financial aid administrator can consider a number of education loans available through the William D. Ford Federal Direct Loan program.  Unlike scholarships, grants or work study programs, loans must be repaid, including their interest.  Federal loans include both the subsidized and unsubsidized Direct Loan programs.  We recommend you borrow only what you need, even if it is less than the offered amount, so you do not over-burden yourself with a large debt.

Federal Perkins Loan - Expired October 1, 2017

Federal Direct Loans

Federal Direct Loans are loans that are in the student’s name and can be either subsidized or unsubsidized.

A subsidized UG Direct loan is awarded on the basis of financial need which is determined from the FAFSA. The interest rate is fixed at 4.99% for 2022-23.  The federal government pays the interest accruing on the loan while the student is enrolled at least half-time in a degree seeking program of study. Repayment does not begin until six months after you have graduated, dropped below half-time status, or withdrawn from the college. The loan is not credit based, nor does it require a co-signer.

An unsubsidized UG and GR loan is not need based. The interest is fixed at 4.99% for UG and 6.54% for GR students for 2022-23. The government does not pay the interest while the student is in school.  The borrower is charged interest from the time the loan is disbursed until it is paid in full.  The student can choose to pay the interest while in school or defer the interest and have it added to the principal balance. As with the subsidized loan, repayment on the principal does not begin until six months after you have graduated, dropped below half-time status, or withdrawn from the college.

For subsidized and unsubsidized loans whose first disbursement is on or after October 1, 2022, the lender withholds 1.057% from the borrowed amount for loan origination fees, prior to disbursement.

Direct loans have maximum annual limits.  The following is a list of the maximum amounts that may be borrowed.

UG Dependent Students:

  • Freshman                        $5,500
  • Sophomore                      $6,500
  • Juniors                            $7,500
  • Seniors                           $7,500

UG Independent Students:

  • Freshman                         $ 9,500
  • Sophomore                      $10,500
  • Junior                             $12,500
  • Senior                            $12,500

Graduate Students:

  • $20,500 Unsubsidized ONLY

Federal Direct Loan Borrower Instructions

  1. In order for the funds to be disbursed, you must begin by accepting the Federal Direct Loan via OASIS at
  2. There are two forms that have to be completed for these loan funds to be disbursed. The forms are the Direct Loan Entrance Counseling form and the Direct Loan Master Promissory Note (e-MPN). These two forms can be found at Farmingdale is listed as "State University of New York at Far".
  3. The Annual Student Loan Acknowledgement (ASLA) is designed to assist borrowers in understanding the financial responsibility of funding their education. Borrowers will see a user-friendly interface available at While it is not required, we recommend you complete the ASLA at, so you are well informed of your cumulative loan balances and repayment obligations.

Duration of Eligibility

Subsidized Loan Limit-  A limit of how many years a student may receive subsidized loans has been established.

Applies to “new borrowers” on or after July 1, 2013

When student has received subsidized loans for 150% of the published time of the academic program –

The student may not receive any additional subsidized loans, and

The subsidized loans received from July 1, 2013 on lose their subsidy

Program Length Limitation on Subsidized Loan Eligibility
4-Year Bachelor's Degree 6 Years of subsidized loan eligibility
2-Year Associates Degree Years of subsidized loan eligibility
1-Year Certificate Program 1 1/2 Years of subsidized loan eligibility
10 Week Certificate Program 15 Weeks of subsidized loan eligibility

Transfer student duration calculation:

  • Transfer students maximum time to receive subsidized loans is established based on the length of the program the student is enrolled in.
  • Remaining subsidized eligibility is calculated by subtracting from maximum eligibility the time the student has already received subsidized loans
  • Transfer Examples –
    • Student receives three years of subsidized loans while enrolled in a two-year program
    • Student transfers to a four-year BA program
    • Student has three years of remaining subsidized loan eligibility
    • Student receives three years of subsidized loans while enrolled in a four-year BA program
    • Student transfers to a two-year AA program
    • Student has no remaining subsidized loan eligibility

Subsidized loans are loans for which the borrower is not responsible for the interest while the student is enrolled in college on at least a half-time basis, when the loan is in the six-month grace period after the student is no longer enrolled at least half time, or if the loan is in a deferment status. This provision eliminates the interest subsidy provided during the six-month grace period for subsidized loans for which the first disbursement is made on or after July 1, 2012, and before July 1, 2014. If you receive a subsidized loan during this timeframe, you will be responsible for the interest that accrues while your loan is in the grace period. You do not have to make payments during the grace period (unless you choose to) but the interest will be added (capitalized) to the principal amount of your loan when the grace period ends. This provision does not eliminate the interest subsidy while the borrower is in school or during eligible periods of deferment.

Federal Parent Loan for Undergraduate Students (PLUS) and Graduate Students

This is a loan that is available to graduate students and parents of a dependent student.  The loan is in the parent’s name and the repayment is the parent’s responsibility.  The interest rate is fixed at 7.54%.  Parents may borrow up to the cost attendance of their dependent’s education, less any amount of financial aid received.  Eligibility is based on credit history.  The loans disburse in two disbursements if for one semester. The loan amount is not to exceed the student’s federal budget.    For loans whose first disbursement is on or after October 1, 2022 the lender withholds 4.288% from the borrowed amount for loan origination fees.  Repayment begins 60 days after the loan is fully disbursed.  The payments are spread out over a 10 year period.  The payments can be deferred while the student is enrolled in school.  Please contact the office of financial aid or the lender of the loan to find out the details. 

There are two forms that have to be completed for the disbursement of these loan funds. An application and the PLUS Master promissory note must be completed. To complete these forms on line please go to

PLUS Adverse Credit Loan Counseling

As of 3/30/2015, any parent PLUS loan applicant that has an adverse credit history and was subsequently approved based on an appeal or the addition of an endorser must now complete PLUS Loan counseling.  The counseling can be found on under “Apply for Aid”.  The parent borrower, not an endorser, is required to complete this on-line counseling prior to any disbursement of the PLUS loan funds.

The PLUS loan credit check expiration dates have been extended from 90 days to 180 days.  Any current PLUS applicants within the last 180 days will be granted an extension so previously expired credit checks may now be acceptable.

Alternative (Private) Loans

To compare Federal Loans and Private Alternative Student Loans, please click on the following link:

Loan Comparison Quick Reference

The Alternative loan is a private loan with the student as the borrower. They are used to fill the gap between the cost of attendance and financial aid received. These loans are non-federal programs and are not federally insured or guaranteed.  It is recommended that students borrow the maximum Federal Direct Loans for which they are eligible before applying for a private loan.  Alternative loans are issued in the student’s name.  Private loan lenders usually defer the principal payment while the student is in school and for up to six months after the student has graduated, dropped below half-time status, or withdrawn from the College.  Alternative loans are based on a student’s credit history and can have a higher interest rate.  A lack of established credit history may require the use of a co-signer.  The interest rate is variable and the fees could be as low as 0%, which are based on the credit of the co-signer.  An Alternative Loan Application will need to be completed.  The student must contact the lender directly.

Parents and Students should pursue all the financial aid including grants, scholarships, work study, Federal Direct loans, and Federal Parent (PLUS) before pursuing a private/alternative loan as the terms of the private/alternative loan are generally not as favorable as compared to the Federal loan programs.

Alternative Loan Disclosures

In accordance with the Truth in Lending Act (TILA), financial lending institutions are required to provide students with three loan disclosures. Each disclosure informs the borrower of specific information regarding the loan.

  1. Application Disclosure: the Application Disclosure is generally presented to the borrower along with the loan application. If the disclosure is not provided with the initial loan application, the lender will be required to mail an Application Disclosure to the borrower within three days after an application is received.

The Application Disclosure contains pertinent information about:

  1. the range of rates
  2. fees
  3. other terms that apply
  4. total cost of the loan
  5. federal student loan options

Please be aware the Application Disclosure must be accepted and signed by the borrower and cosigner in order to proceed through the application process.

  1. Approval Disclosure: the Approval Disclosure is provided to the borrower electronically or by mail when the lender has conditionally approved or approved the borrower for a loan.

The borrower and cosigner will receive the Approval Disclosure as part of the application process before the promissory note is signed. The Approval Disclosure must be accepted by both the borrower and cosigner within 30 calendar days of the credit offer. The Approval Disclosure must state the acceptance date deadline and the manner in which the lender requires the borrower to accept the terms of the loan. If any permissible changes (i.e. changes made to accommodate a borrower request) are made to the loan, a new disclosure and 30 day acceptance period is required to accept new terms.

Remember that the Approval Disclosure must be accepted and signed by the borrower and cosigner (if applicable) prior to continuation of the application process.

  1. Final Disclosure: the Final Disclosure is presented to the borrower after the loan terms have been accepted. A three day recession period occurs after the Final Disclosure is presented to the borrower.

The Final Disclosure will note the borrowers' right to cancel the loan, state the deadline for cancellation, and the methods in which a lender accepts a cancellation request.

Lastly, the Final Disclosure provides the borrower with the final information on the cost of their loan.

Last Modified 6/15/22