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Federal Student Loans

Low interest federal loans are available to assist eligible students who are enrolled at least half-time.

When should I begin the application process for 2023-2024?

Students should wait until they have a financial aid notification that confirms eligibility for Subsidized and/or Unsubsidized Federal Student Loans, as well as the amounts.

  • NEW STUDENTS are eligible to begin the loan process in LATE MAY. Additional instructions will be sent in May to students who have paid an enrollment deposit.

  • Returning student notifications are sent beginning in mid-June.

  • Complete the loan application steps provided at the bottom of this page.

General Requirements for Federal Student Loans

  • Student borrowers applying for a Federal Student Loan must be U.S. citizens or eligible non-citizens.

  • Students must be enrolled at least half-time in a degree seeking program.

  • Students applying for a Federal Student Loan must complete the Free Application for Federal Student Aid (FAFSA) each year.

Subsidized Federal STUDENT Loans

Students that meet certain financial need criteria may qualify for a Subsidized Federal Student Loan. The federal government pays the interest on the Subsidized Loan while students are enrolled at least half-time and when they qualify for an authorized deferment. Interest subsidies are also available during grace periods.

Unsubsidized Federal student Loans

Students who do not qualify for a Subsidized Federal Student Loan may be eligible for an Unsubsidized Federal Student Loan. The federal government does not pay the interest on an Unsubsidized Loan. Students have the option of paying the interest while they are in school, or they can choose to have the interest added to their principal balance through a process called capitalization, thus increasing the amount to be repaid.

Student Rights and Responsibilities Under the Federal Direct Loan Program


Federal Student loan Annual Limits

(Annual Loan Limit)
(Annual Loan Limit)
All Students
(Maximum Subsidized Loan Limit)
First-Year $5,500 $9,500 $3,500
Sophomore $6,500 $10,500 $4,500
Junior / Senior $7,500 $12,500 $5,500
Note: Dependent students whose parent has been denied a PLUS Loan may be eligible for additional Unsubsidized Federal Student Loans. Contact the Financial Aid Office for details.

Loan Fees

The Subsidized and Unsubsidized Federal Student Loans currently have a 1.057% origination fee that will be deducted from the gross amount of the loan at the time of disbursement.   

Interest Rates

The interest rate on Subsidized and Unsubsidized Federal Student Loans is fixed at 5.50% (for loans disbursed after July 1, 2023). 

Loan Disbursement

  • Paid in two disbursements: The first at the beginning of the loan period and the second halfway through the loan period. Typically, disbursements occur mid-August and again in mid-January (approximately 10 days before the start of each semester).
  • Proceeds are applied to any outstanding educational charges including tuition, fees, housing and meals. The Financial Aid Office will notify the borrower when the disbursement is credited. If there is a credit balance DePauw University will issue a refund to the borrower.

Repayment Terms

After you graduate, leave school, or drop below half-time enrollment, you will have a six-month “grace period” before you begin repayment. You typically have 10 years to repay your Federal Student Loan. There are no prepayment penalties on a Federal Student Loan.


To apply for your Federal Direct Student Loan(s):