Federal Direct Subsidized Loan

A guaranteed student loan for undergraduates who are U.S. citizens or permanent residents and who have demonstrated financial need as determined by federal regulations.

  • You must be a U.S. citizen or a permanent resident
  • You must be enrolled at least half-time in an undergraduate degree program
  • You must maintain satisfactory academic progress
  • You cannot be in default on a federal student loan
  • You must have federal need
Interest rate: 

Fixed at 5.50% for loans first disbursed from July 1, 2023, through June 30, 2024

Loan fees: 

1.057% origination fee for loans first disbursed from October 1, 2020, through September 30, 2024

Loan limits: 

The federal government sets limits on the amount in Direct Subsidized loans that a student may be eligible to receive in each academic year and in total. Limits vary based on the student's year in school, among other factors.

For loan limits and further details, please see under "How much can I borrow?" on the Federal Student Aid webpage on Direct loans.

Interest accrual: 

No interest is charged while a student is in school at least half-time and during deferment periods.


Six-month grace period; time frame depends on the type of repayment plan.

For information on repayment plan options, visit the Federal Student Aid Repayment Plans webpage.

Application procedure: 

New borrowers will be notified to complete the Direct Loan Master Promissory Note once Yale originates the loan with the Department of Education. They will also be notified to complete the Federal Loan Entrance Counseling Session required for all first-time borrowers.

Additional resources: