Loans

The William D. Ford Federal Direct Loan (Direct Loan) Program is the largest federal student loan program. Under this program, the U.S. Department of Education is your lender. Please visit Your Federal Student Loan Guide for detailed information on Federal Student Loans.

What Are the Interest Rates for Federal Student Loans?

The interest rate varies depending on the loan type and (for most types of federal student loans) the first disbursement date of the loan. The table below provides interest rates for Direct Subsidized Loans, Direct Unsubsidized Loans and Direct PLUS Loans first disbursed on or after July 1, 2023, and before July 1, 2024.

Undergraduate Borrowers	Graduate or Professional Borrowers	Parents and Graduate or Professional Students
5.50%	7.05%	8.05%
Direct Subsidized Loans and Direct Unsubsidized Loans	Direct Unsubsidized Loans	Direct PLUS Loans

The table below provides interest rates for Direct Subsidized Loans, Direct Unsubsidized Loans, and Direct PLUS Loans first disbursed on or after July 1, 2022, and before July 1, 2023.

Undergraduate Borrowers	Graduate or Professional Borrowers	Parents and Graduate or Professional Students
4.99%	6.54%	7.54%
Direct Subsidized Loans and Direct Unsubsidized Loans	Direct Unsubsidized Loans	Direct PLUS Loans

All interest rates shown in the charts above are fixed rates. A fixed rate will not change for the life of the loan.

If your loan was disbursed before July 1, 2023, you likely have a different interest rate. View interest rates for loans disbursed earlier.

Federal Direct Loan Fees

A loan fee comes out of the amount of money that is disbursed (paid out) to you while you’re in school. This means the money you receive will be less than the amount you actually borrow.

You’re responsible for repaying the entire amount you borrowed and not just the amount you received.

The chart below shows the loan fees for Direct Subsidized Loans, Direct Unsubsidized Loans and Direct PLUS Loans first disbursed on or after Oct. 1, 2019.

Loan Fees for Direct Subsidized Loans and Direct Unsubsidized Loans

First Disbursement Date	Loan Fee
On or after 10/1/20 and before 10/1/24	1.057%
On or after 10/1/19 and before 10/1/20	1.059%

Loan Fees for Direct PLUS Loans

First Disbursement Date	Loan Fee
On or after 10/1/20 and before 10/1/24	4.228%
On or after 10/1/19 and before 10/1/20	4.236%

Loans first disbursed prior to Oct. 1, 2019, have different loan fees.

How to Apply for Federal Direct Loans

To apply for a Federal Direct Loan, you must first complete and submit the Free Application for Federal Student Aid (FAFSA^®) form. The information from your FAFSA form is used to determine how much student aid you are eligible to receive. If you are offered a new Federal Direct Loan(s) at any time you must accept this loan before the last day of the term and/or the last day of the last term you attended in the academic year. The Following must be completed before any funds are disbursed to your student account:

• Annual Student Loan Acknowledgment
• Master Promissory Note/Federal Direct Loan Application
• Entrance Loan Counseling

Please Note: Any time your Financial Aid changes, a revised notification is sent to your ERAU email. At such time, you should review your revised Financial Aid Offer by logging into ERNIE and view your Campus Solutions Student Homepage > Financial Aid. Please review the Financial Aid Terms and Conditions on financial aid eligibility as all aid is subject to change.

Annual and Aggregate Federal Loan Limits

The following chart shows the annual and aggregate limits for subsidized and unsubsidized loans.

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.

If the total loan amount you receive over the course of your education reaches the aggregate loan limit, you are not eligible to receive additional loans. However, if you repay some of your loans to bring your outstanding loan debt below the aggregate loan limit, you could then borrow again, up to the amount of your remaining eligibility under the aggregate loan limit. For more information, please visit the federal student aid site.

Transfer Student? Know your Loan Limits

As a transfer student, it is your responsibility to know your annual loan limits for Federal Direct Loans and have all pending disbursements cancelled at your previous school before transferring to Embry-Riddle. This ensures a more accurate award package.

Before accepting a Federal Direct Loan(s) at Embry-Riddle, you must inform the Office of Financial Aid of any disbursements you received at another school during the academic year. Due to the timing of loans, we may not be aware of the total loan amounts you may have received at your other school. Failure to notify our office of any loans you received at another school during the year can result in your existing loans being reduced and billed in order to keep within the annual loan limits. This would result in a balance owed (by you) to Embry-Riddle.

To avoid being over-awarded at Embry-Riddle, please follow these simple steps:

• Cancel any pending financial aid disbursements at your previous school before transferring
• Inform us of any financial aid received at another institution in the same academic year

Note: Your previous school may also contact us directly by looking up our contact info on the National Student Loan Data System (NSLDS).

Don’t Over-borrow

Over-borrowing or going into EXCESS of your aggregate loan limits will prevent you from receiving any Federal Student Aid! In order to regain financial aid eligibility, you must make satisfactory arrangements with your loan holder and turn in the appropriate documentation to our office. Acceptable documentation may include but is not limited to:

Resolving a Loan Overage

If you have received loans in excess of the lifetime aggregates, you must choose from the two options listed below in order to resolve the overage:

Federal student loans can be very useful in helping cover education and living expenses, but it is important to keep in mind that loans must be repaid. Borrowers need to understand the responsibility that comes with student loan debt because their borrowing decisions will impact their ability to meet future financial obligations. 

The articles below can help borrowers learn more about responsible borrowing and successful repayment.

• What is Default?
• Avoiding Default
• Repaying Loans
• Tips for Members of the U.S. Armed Forces
• Repayment Estimator and Repayment Plans
• Financial Awareness Counseling Tool
• Manage My Direct Loan
• MyMoney.Gov
• Deferment and Forbearance

Repayment Guides and Information

• Your Total Student Loan Balance
• Guide Managing Repayment
• Repayment Plans
• Debt Resolutions
• Default Prevention
• Deferment and Forbearance 

Student Loan Disputes

Embry-Riddle Worldwide students are provided an opportunity to express any complaints, grievances, or disputes through the Embry-Riddle Worldwide support system. See a more detailed explanation of the Embry-Riddle Worldwide Student Complaint Process in the catalog.

Please note: Students seeking loan repayment or complaints relating to student loans or student loan servicers may also contact your appropriate state advocacy:

For Washington State residents: Washington State residents seeking information and resources about student loan repayment or seeking to submit a complaint relating to your student loans or student loan servicer, please visit www.wsac.wa.gov/loan-advocacy or contact the Student Loan Advocate at loanadvocate@wsac.wa.gov.

If you’re in a dispute about your federal student aid, contact the Federal Student Aid Ombudsman Group as a last resort. The Ombudsman Group is dedicated to helping resolve disputes related to the federal student aid programs, including Direct Loans, Federal Family Education Loan (FFEL) Program loans, Perkins Loans and grant programs.

Exit Loan Counseling

Review the Exit Loan Counseling Guide.

All students receiving Federal Direct Loans must attend an Exit Loan Counseling session prior to graduation, withdrawal from the university, who break continuous enrollment (do not attend all terms in assigned track) or if enrollment drops below half-time status (three credit hours) for undergraduate or full-time (three credit hours) for graduate and Ph.D. degree students anytime during the current academic year.

Private Education Loans are offered by private lending organizations. They can supplement the amount the government allows you to borrow in its programs. Private student loan repayment options vary by plan and provider. However, once students find a lender to borrow from, they can do similar research on how much to borrow as well as what payments may look like after graduation in order to make smart borrowing choices. From there, students can either commit to a lender or shop around a little more to find a better interest rate or lending agreement. For more information on the difference between federal and private loans, please visit: http://www.consumerfinance.gov/paying-for-college/choose-a-student-loan/

• Searching for a lender? You may visit FastChoice to help you determine which private loan best meets your needs and understand your options, responsibilities and the various details of each lender's loan products.
• Students applying for a private loan are required to complete a Self-Certification form before the lender can disburse funds to the University. Students complete the form directly with the lender. 
• The lender determines eligibility, and amounts are limited to the cost of attendance minus other aid, including third-party tuition assistance, employee contracts, employee waivers, scholarships, grants, loans and any other resources received.
• Loan Certification: Embry-Riddle will receive a notification when your private loan has been certified. You will receive an award notification once your enrollment is confirmed. Your private loan will be awarded based on your Cost of Attendance (COA) and your eligible terms in your Track (i.e., eligible periods of enrollment). Financial aid cannot exceed the student's Financial Need or the COA for the eligible term(s) in a student's track:
  • Tracks (period of enrollment):
  • Track 2: August Term - October Term - January Term - March Term - (May Term, if remaining aid is available, or Start Term)
  • Track 1: July Term - September Term - November Term - February Term - (April Term, if remaining aid is available, or Start Term)
• Once a private loan has been certified and the disclosure form has been signed, you can only request for reinstatement or increase by following these steps: 
• Contact the lender to apply for a new application. Note that a new credit check may be required.
• If your credit is approved, your lender will send the school a new certification request.
• Private loan decreases and cancellations must be submitted to your Financial Aid Counselor prior to loan disbursements.

Things to Look for in a Private Loan

• Eligibility requirements: Most private loans require a credit-worthy applicant and/or co-signer. Having a co-signer may reduce the cost of the loan.
• Interest rates: Most private loans have variable interest rates. Determine how often the interest rate is adjusted and how it's calculated.
• Fees: Many private loans have fees deducted from, or added to, the amount you borrow. Find out when they're charged and how much.
• Annual Percentage Rate (APR): The APR is the annual cost of your loan, including the effect of any fees and charges in addition to interest. Remember, a loan with fees and a lower base interest rate may be as good of a choice as a loan with no fees and a higher base interest rate. APR helps show how all charges affect the cost of the loan.
• Repayment: Determine the repayment terms, including monthly payments and repayment period. Some lenders offer rewards, such as interest rate reduction, to borrowers who make payments on time or via electronic funds transfer (EFT).
• Loan limits: Check to see if there is an annual or aggregate limit. Try to pick a lender who has an aggregate limit that works best with your program of study. Some private loans have maximum limits, while others allow you to borrow up to your total cost of attending school.
• Compare lenders and apply for private loans.
• Credit checks: Both the borrower and co-signer must pass a credit check. Applying with a qualified co-signer may give you the best rate. Private loan credit checks are valid for a limited time. Please check with your lender for details.
• Do not hesitate to contact us at 1-866-567-7202 with any questions.

On April 6, 2022, the U.S. Department of Education (ED) announced an initiative — called “Fresh Start” — to help eligible borrowers in default. Fresh Start will continue through one year after the COVID-19 payment pause ends.

This is not loan forgiveness, meaning your loan debt balance is not being reduced or canceled. All Fresh Start initiative participants must repay their loans and will have one year after the end of the COVID-19 student loan payment pause to make payment arrangements. Any borrower with eligible defaulted federal student loans can make payment arrangements during the initiative by visiting the ED's Debt Resolution website, contacting their loan holder by phone or in writing, or calling the Default Resolution Group at 1-800-621-3115.

You may regain Federal Student Aid benefits:

• Restores access to repayment options — that could offer monthly payments as low as $0 through IDR plans — and provide opportunities for loan forgiveness.
• Restores eligibility to receive federal student aid, including Federal Pell Grants and campus-based aid like Federal Work-Study, so borrowers can complete their course of study and increase long-term repayment success.
• Protects borrowers from involuntary collection efforts and costly collection fees.
• Restores eligibility for future rehabilitation for borrowers who rehabilitated a defaulted loan during the payment pause.
• Provides credit reporting features — including removing borrowers from the federal Credit Alert Verification Reporting System (CAIVRS) — making it potentially easier and more affordable for student loan borrowers to afford living expenses.

Eligible Loans:

• Defaulted William D. Ford Federal Direct Loan (Direct Loan) Program loans
• Defaulted Federal Family Education Loan (FFEL) Program loans (both ED-held and commercial held)
• Defaulted ED-held Perkins Loans

Loans Not Eligible:

• Defaulted school-held Perkins Loans
• Defaulted Health Education Assistance Loan Program loans
• Student loans remaining with the U.S. Department of Justice (DOJ)
• Direct Loans and commercial-held FFEL Program loans that default after the end of the pause on student loan payments and collections

If you’re not sure whether your loans qualify, you can call the Default Resolution Group at 1-800-621-3115 (TTY for the deaf or hard of hearing 1-877-825-9923).

Process

Process for students returning to school with a loan default:

• A Free Application for Federal Student Aid is required to notify the institution of your intent to return to school.
• Once we receive your FAFSA, we will review your eligibility for the Fresh Start Initiative based on which loans are in default and when.
• If you qualify, a form will be added to your To-Do List to complete.
• Once the Acknowledgment form is returned, we will review and, if eligible, will proceed in awarding Title IV aid.

Process for parents applying for a Parent PLUS Loan with a default:

• A Parent PLUS Loan application will need to be submitted to notify the institution of your intent to receive Title IV aid.
• Once we receive the PLUS Loan application, we will review the parent's eligibility for the Fresh Start Initiative.
• If eligible, a form will be sent to the parent's email on file. This will include next steps, additional information about Fresh Start and a page that requires a signature. This signature page needs to be returned to our office.
• Once we have received the form, we will review the information again and let the parent know how to proceed.

For more and updated information, please visit the Federal Student Aid website.