How Much Student Loan Can You Borrow?

How much can you borrow in federal student loans? The answer depends on many factors, including your year in school and dependency status.

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Federal Loans

The first step in borrowing money for college is understanding the types of loans available to you. Federal loans, offered by the government, tend to have lower interest rates and more flexible repayment options than private loans, making them a good choice for most students. But how much can you actually borrow?

Direct Subsidized Loans

Direct Subsidized Loans are awarded based on financial need. Students must be enrolled at least half-time to be eligible. The maximum amount students can borrow each academic year is:

-$5,500 for first-year undergraduate students, with no more than $3,500 of this amount in subsidized loans.
-$6,500 for second-year undergraduate students, with no more than $4,500 of this amount in subsidized loans.
-$7,500 for third- and fourth-year undergraduate students, with no more than $5,500 of this amount in subsidized loans.
-Graduate and professional degree students can borrow up to $20,500 each academic year in Direct Unsubsidized Loans. The entire amount may be unsubsidized.

Direct Unsubsidized Loans

Direct Unsubsidized Loans are available to both undergraduate and graduate students. There is no limit on the amount you can borrow, but there are limits on how much of that total can be subsidized by the government. The interest rate for Direct Unsubsidized Loans first disbursed on or after July 1, 2020 and before July 1, 2021 is 2.75%.

Direct PLUS Loans

Parents and graduate or professional degree students can borrow directly from the federal government to help pay for education expenses not covered by other financial aid. The U.S. Department of Education (DOE) makes Direct PLUS Loans to eligible borrowers through schools participating in the Direct Loan Program.

A credit check is required for PLUS Loans. If you have an adverse credit history, you may still receive a Direct PLUS Loan if you obtain an endorser who does not have an adverse credit history or documentation demonstrating that the adverse credit history is not indicative of your ability to repay the loan.

Note: First-time borrowers of Direct PLUS Loans will be subject to a nonsatisfactory academic progress policy as required by law. This policy could limit your future ability to borrowDirect PLUS Loans.

Private Loans

The amount you can borrow through a private loan depends on several factors, including your credit score, income, and the amount of money you have already borrowed. Most private lenders will allow you to borrow up to $20,000 per year, but some may limit you to borrowing only $10,000.

How Much Can You Borrow?

The first step in getting a student loan is understanding how much you can borrow. Depending on the type of loan you choose, the amount you can borrow may be different. Federal student loans have borrowing limits that are set by the government, while private student loans usually have higher borrowing limits. This section will provide an overview of how much you can borrow for both federal and private student loans.

Undergraduate Students

Undergraduate students can borrow Direct Subsidized Loans and Direct Unsubsidized Loans.

Your school will first apply your financial aid to charges for tuition, fees, room and board, and other required expenses. If you have financial aid left over, you can use it to cover other allowable costs, such as a computer or dependent care.

The maximum amount you can borrow each year in Direct Subsidized Loans and Direct Unsubsidized Loans depends on several factors, including
-whether you are a dependent or an independent student,
-what year you are in school, and
-if you are a graduate or professional student.

Graduate and Professional Students

Graduate and professional students enrolled in certain health profession programs may borrow up to $40,500 per year in Direct Unsubsidized Loans. The actual loan amount you receive will depend on your cost of attendance, other financial aid you receive, your school’s policies, and other factors.

In addition to the unsubsidized loan limits, graduate and professional students may also be eligible for Direct PLUS Loans. The maximum amount you can borrow with a PLUS Loan depends on your cost of attendance minus any other financial aid you receive.

Borrowing Limits

The amount you can borrow for your educational expenses depends on a variety of factors. The type of loan, the length of your studies, your program of study, and your other financial aid all play a role in how much you can borrow. Find out more about how these factors affect your borrowing limits.

Annual Loan Limits

Annual loan limits vary by grade level. The following table outlines annual loan limits for both subsidized and unsubsidized Stafford Loans as well as PLUS Loans.

– Freshman (0-23 credit hours): $5,500 total; no more than $3,500 of this amount may be in subsidized loans.
– Sophomore (24-59 credit hours): $6,500 total; no more than $4,500 of this amount may be in subsidized loans.
– Junior and senior (60+ credit hours): $7,500 total; no more than $5,500 of this amount may be in subsidized loans.

Aggregate Loan Limits

The amount you can borrow for your education with federal student loans depends on several factors, including:
-The type of loan you choose ( subsidized or unsubsidized)
-Your year in school
-Whether you are a dependent or independent student
-Other financial aid you receive

There are two types of federal student loans: subsidized and unsubsidized. Subsidized loans are need-based, meaning that the government pays the interest while you’re in school. Unsubsidized loans are not need-based, so you will be responsible for the interest from the time the loan is disbursed.

The maximum amount you can borrow each year in subsidized and unsubsidized loans depends on your year in school. If you are a dependent student, your parents may also be able to borrow a Direct PLUS Loan to help pay for your education. If you are an independent student or if your parents are unable to obtain a PLUS Loan, you may be eligible to receive additional unsubsidized loan funds.