Loan Programs

Main Content

Graduate Direct Loans

The Federal Direct Loan is available through the Federal Direct Loan Program to help UMMC's undergraduate and graduate students pay for their education.

There are two types of Federal Direct Loans - subsidized and unsubsidized.

Direct subsidized loan

Eligibility for subsidized loans is based on financial need as determined by federal guidelines. A loan is called "subsidized" because the government pays interest for the student during:

  • At least half-time enrollment in school.
  • The six-month grace period after the student ceases attendance on at least a half-time basis.

Direct unsubsidized loan

This loan is available to students regardless of income or need. With an unsubsidized loan, you are responsible for all interest that accrues during in-school, grace and deferment periods. You may choose to pay the interest portion only while in school, which would keep your loan balance at principal. If you choose to defer such payments, the interest will be capitalized, resulting in an increase in both total debt and the amount of monthly payments.


  • The interest rate is fixed at 6.8% for unsubsidized and 4.5% for subsidized Federal Direct loans.
  • It carries low origination fees. Many other loans have significantly higher fees.
  • Repayment of the loan does not begin until you graduate or drop below half-time status.
  • In cases of economic hardship, payments may be deferred, extended, or reduced.
  • The loan is forgiven in case of permanent disability or death.

Loans are usually issued for a single academic year, and both eligibility and amount are redetermined annually throughout your academic career.


Your Direct Loan eligibility is determined by the Financial Aid Office and is based on information you provided in the Free Application for Federal Student Aid (FAFSA).

Federal criteria include:

  • Enrollment in an eligible school at least half-time in a degree program
  • U.S. citizenship, permanent residency, or eligible noncitizen status
  • Satisfactory academic progress (as determined by the Office of Financial Aid)
  • No unresolved defaults or overpayments owed on Title IV educational loans and grants
  • Satisfaction of all Selective Service Act requirements

Borrowing limits

Borrowing limits are based on your dependency status and year in school. You are considered independent if you will be working on a degree beyond a bachelor's degree during the school year.

You can never borrow more than the cost of education, less other financial aid received (special rules apply for recipients of Montgomery Chapter 30 VA benefits and Americorps benefits). Below are the maximum amounts you may borrow.

As a graduate student, your subsidized and unsubsidized Direct Loan annual eligibility is as follows:

Graduate Students
Medical and Dental Students
Unsubsidized$12,000 plus $20,0000-$26,000 depending on the length of the program academic year

Graduate/Professional Students can borrow a maximum total of $138,500 (of which no more than $65,500 can be subsidized loans). Medical and Dental students may borrow a maximum of $224,000 (of which no more than $65,500 can be subsidized). These loan limits include all loans borrowed as an undergraduate.  

Sample loan repayment disclosure information

Interest rate

The interest rate is fixed at 6.8% for unsubsidized and 4.5% for subsidized Direct loans.

Loan fees

For all Direct Subsidized Loans and Direct Unsubsidized Loans made between July 1, 2011, and June 30, 2012, the origination fee will be 1.00% of the principal loan amount.

However, there is an automatic rebate amount equal to 0.50% of the principal loan amount. Therefore, the actual total up-front fee is only equal to 0.50% of the principal loan amount. The 0.50% fee is deducted from the principal at each disbursement.


Loan amount$2,000
Total up-front fee (0.50%)-$10
Amount disbursed - fall$995
Amount disbursed - spring$995

To retain the up-front interest rebate of 0.50%, a borrower must make the first 12 monthly payments on time.

If all of the 12 monthly payments are not made on time, the rebate amount is added to the borrower's principal loan balance, which will increase the loan amount that must be repaid.

Application process

Here's a step-by-step guide to the Stafford application process:

  • Complete a Free Application for Federal Student Aid (FAFSA) application online at the Department of Education's website .
  • Once your FAFSA is processed, you will receive a Student Aid Report (SAR) documenting your financial resources and expected family contribution towards educational costs. An electronic copy will be sent to the Office of Financial Aid of the school listed on your application. The University of Mississippi's school code is 004688.
  • Check your SAR for accuracy. If there are errors, follow the correction process indicated on the SAR or as instructed by the Office of Financial Aid.
  • From the information obtained in the SAR and other supporting documents, we will generate an online Financial Aid Award Notification documenting the financial aid available to you including Federal Direct Loan eligibility.
  • The student may accept all or a part of the aid by accepting and confirming the Financial Aid Award Notification online.
  • The student must complete the online Loan Entrance Counseling.
  • Once the Financial Aid Award Notification has been accepted and submitted and Loan Entrance Counseling has been completed, you may sign your school-certified Federal Direct Loan application/Promissory Note online. You will need to e-sign a new Master Promissory Note for the Federal Direct Program.
  • You will receive a Notice of Guarantee and Disclosure Statement. This is your notice of loan approval, and it contains essential information about the terms and conditions of your loan. It also tells you the amount of your loan and an estimated date for the arrival of funds.

Disbursement of funds

An Electronic Funds Transfer (EFT) will be sent directly to our school. The amount of the proceeds will be the loan amount less the fees. Funds will credit first to your tuition bill and any excess funds will be mailed to your permanent address or directly deposited to your personal account.