Loan Options

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:

1. Log on to myUNW (only current students can log in with their username and password)
2. Under Pages, select Financial Aid (Financial Aid Information and Resources)
3. Under Resources, select View Your Financial Aid
4. Update Award Year (upper right corner)
5. Go to Award Offer to accept, change amount, or decline loans.
6. 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 2023-24 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:

1. The parent borrowing the Parent PLUS loan should go to studentaid.gov and log in with their FSA ID.
2. 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.
3. 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”.
4. 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.