Loan Options
Money not covered by scholarships or grants can be obtained through various loans; however, unlike grants and scholarships, a loan is a long-term financing option that is repaid with interest after graduation. Terms and interest rates vary. Your eligibility for loans is determined by the Free Application for Federal Student Aid (FAFSA).
Types of Loans
When you receive your award package, you will see a list of the loans for which you are eligible as well as the funds available per loan. You may choose to borrow all, some, or none of the loan amount.
The Federal Direct Loan program provides low-interest educational loans to degree seeking students enrolled at least half-time. There are two different types of Federal Direct loans:
- Subsidized: The federal government pays the interest while the student is in school and during the six-month grace period. This loan is not available to graduate students.
- Unsubsidized: Interest accrues while a student is in school and during the grace period.
Traditional & Adult Undergraduate Students Only
Direct Subsidized Loan
This loan is awarded to students who demonstrate financial need as determined by the FAFSA. The federal government pays interest on this loan while the student is enrolled in school, at least half-time and pursuing a degree or certificate. The fixed interest rate for the life of the loan is based on the date of the first disbursement. Origination fees are subtracted from the loans by the federal government. Loan funds (without the fees) are evenly split between the terms of enrollment and are disbursed directly to the student’s Northwestern account.
Traditional, Adult Undergraduate, Online & Graduate Studies
Direct Unsubsidized Loan
This loan is non-need based and the student borrower is responsible for the interest which accrues on the loan while enrolled and prior to repayment. The student may choose to make interest payments during the in-school period or capitalize the unpaid accrued interest when repayment begins.
Interest Rates, Fees, and Disbursement
View Interest rates and loan fees for Federal Direct Loans. Origination fees are subtracted from the loans by the federal government. Loan funds (without the fees) are evenly split between the terms of enrollment and are disbursed directly to the student’s Northwestern account.
Loan Authorization Instructions
If you have been awarded a Federal Direct Loan, please follow these steps to accept the award:
- Log on to myUNW (only current students can log in with their username and password)
- Under Pages, select Financial Aid (Financial Aid Information and Resources)
- Under Resources, select View Your Financial Aid
- Update Award Year (upper right corner)
- Go to Award Offer to accept, change amount, or decline loans.
- Complete additional loan requirements defined below if they apply to you.
If you are accepting your first Federal DL Loan (Subsidized and/or Unsubsidized) at Northwestern, you must go to https://studentaid.gov – Login with FSA ID, under “Loans and Grants”, select and complete both “Master Promissory Note (MPN)” and “Loan Entrance Counseling“.
Review Lender-sponsored private loans at Fast Choice.
A Federal Direct Loan is a long-term, fixed rate loan for students or parents of students. Eligibility is determined by completing a Free Application for Federal Student Aid form (FAFSA). Students must be enrolled at least half-time (6 credits) to be eligible to receive a Federal Direct Loan. Repayment on the Federal Sub and/or Unsub loan begins six months after a student graduates or drops below half-time enrollment. Repayment on the Federal PLUS Parent loan begins 60 days after the entire loan is disbursed to the student’s account, but a parent does have the option to defer loan payment until after the student graduates or drops below half-time enrollment. The current interest rates and loan fees for Federal Direct Loans are available at https://studentaid.gov/understand-aid/types/loans/interest-rates.
Parent PLUS loans are government-insured loans made by the U.S. Department of Education for parents of traditional undergraduate dependent students. The Parent PLUS loan is non-need-based, for parents to borrow on behalf of their student. The availability of the loan is based partly on the parents’ creditworthiness. Parents may borrow up to the cost of education less other financial aid for their child. Interest is paid by the parent and there is no grace period. Read the 2024-25 PLUS Loans FAQs for more detailed information or view the FAQ section for the PLUS loan on studentaid.gov. Parents can also view interest rates and fees for the Direct Parent PLUS Loan.
Repayment starts within 60-days of the final disbursement of the funds for the given academic year. Parents who wish to defer repayment until after their student graduates should go to studentaid.gov for more information.
NOTE: Lender for Federal Direct and PLUS loans
The lender for the Federal Direct loans and PLUS loans is the U.S. Department of Education—not a bank or financial institution.
Parent Plus Loan Authorization Instructions
To borrow a Parent PLUS Loan, please follow these steps to accept the award:
- The parent borrowing the Parent PLUS loan should go to studentaid.gov and log in with their FSA ID.
- Under “Loans and Grants”, select “PLUS Loans: Grad PLUS and Parent PLUS”. Then select “Learn More” and then “Start”. You will be led through the Parent PLUS Loan application process.
- If this is the first time that your parent is borrowing the Parent PLUS Loan, the parent will also need to select and complete Master Promissory Note (MPN). Under “Loans and Grants”, select “Master Promissory Note (MPN). Once redirected, select “Start” for “I’m a Parent of an Undergraduate Student”.
- Parents who believe they will not qualify for the Parent PLUS loan should contact the Financial Aid office for alternative options.
The Direct Loan Program will send you a loan disclosure statement once your loan has been processed. It will show the total amount of your loan, the disbursement amounts and the estimated disbursement dates.
Traditional Undergraduate
The Federal Direct Parent Loan for Undergraduate Students (PLUS) is a non-need based low-interest loan specifically for parents to help pay for the cost of a student’s education after high school.
Traditional & Adult Undergraduate
This Federal Direct Subsidized Loan is awarded to students who demonstrate financial need as determined by the FAFSA. The federal government pays interest on this loan while the student is enrolled in school (at least half-time, pursuing a degree or certificate) and during a six month grace period after leaving in-school status. The fixed interest rate for the life of the loan is based on the date of the first disbursement.
Undergraduate & Graduate
This Federal Direct Unsubsidized Loan is non-need based and the student borrower is responsible for the interest which accrues on the loan while enrolled and prior to repayment. The student may choose to make interest payments during the in-school period or capitalize the unpaid accrued interest when repayment begins.
Lender-sponsored private loans
Private loans are an option that some families use to help pay for college. Due to strict credit policies, students should expect to need a cosigner.
Northwestern has a preferred lender list that was developed from these criteria:
- The desire of the lender to assist borrowers from excessive borrowing or facing default.
- The ability to demonstrate the stability of their private loan program into the future.
- Provide exceptional levels of customer service and offer current technological opportunities for easy application.
- A history of familiarity with both our institution and our borrowers (name recognition).
Students are free to select any lender for their private loan needs, and Northwestern will work diligently with any lender chosen. There is no penalty for choosing a lender outside of the preferred list.
Review Lender-sponsored private loans at Fast Choice.
Information for Direct Loan Borrowers
Exit Counseling
If you have completed your education at Northwestern and have borrowed a Direct Loan (Subsidized/Unsubsidized Loans or Perkins Loan) while attending Northwestern, you need to do exit counseling for that loan. You can find the Exit Counseling on studentaid.gov. You will need to log in with your FSA ID, and going under ‘Loan Repayment’ and then clicking on ‘Loan Exit Counseling’. Once you have completed the online exit counseling we will receive email notification that you have completed the process.
Code of Conduct
Read the University of Northwestern Financial Aid Office Code of Conduct..
