Federal Direct Loan Program

The Federal Direct Loan Program is administered directly with the United States Department of Education Federal Direct Subsidized and Unsubsidized Loans.  These are low-interest loans from the U.S. Department of Education.

Please ensure you submit your request for a Federal Direct Loan by the deadline listed below: 

  • Fall 2022/Spring 2023 - November 21, 2022
  • Fall 2022 Only - November 21, 2022
  • Spring 2023 Only - May 1, 2023

*Late loan request may not be accepted to ensure compliance with federal regulations.

*Please note loans are not disbursed for Summer

Direct Loan Eligibility

To request a Federal Direct Loan, you must complete the Free Application for Federal Student Aid and submit all requested documentation.

  • You must be enrolled for 6 units at Saddleback College to be eligible for a loan
  • You must be meeting all Satisfactory Academic Progress standards
  • Complete ALL sections of the Federal Direct Loan Request Form (link below)
  • Please note the following documentation will be required (links are provided in the request form):
    • Master Promissory Note
    • Entrance Counseling
    • Government Issued ID 

Steps for requesting a Federal Direct Loan:

  1. Start the process by submitting the Direct Loan request form by the published deadline date.  Please log into your secure portal at saddleback.verifymyfafsa.com. Once logged in, click on "request" and then select the "loan request" option.
  2. Complete Master Promissory Note (MPN) for Saddleback College at https://studentaid.gov/mpn/ .
  3. Complete Entrance Counseling each year at https://studentaid.gov/entrance-counseling/.
  4. Submit a photocopy of the front and back of your Driver’s License or valid government issued ID .

Tips on Borrowing Student Loans


Thumbnail of A Minute to Learn It - Borrowing Student Loans


Things to Know About Student Loans


Thumbnail of A Minute to Learn It - Federal Direct Student Loans for Undergrads

Subsidized Direct Loan

The Subsidized Direct Loan is need-based.  The federal government pays the interest on the loan during:(1) your enrollment in school on at least a half time basis, (2) a six-month grace period immediately following your separation from school, and (3) a deferment, which is a temporary, authorized time when your payments may be postponed.

Unsubsidized Direct Loan

The Unsubsidized Direct Loan is non-need-based.  "Unsubsidized" means the federal government does not pay the interest on your behalf. You are responsible for paying all interest on the loan.  Interest is charged beginning the day the loan is paid to you until the day the loan is repaid in full.  You either may choose to pay the accumulated interest while you are in school or to have the unpaid, interest capitalized, i.e., added to the principal balance of the loan.  Note: If your loan interest is capitalized, it will increase the amount you have to repay.

Please Note: Saddleback College Does NOT participate in the Direct PLUS Loan Program.

How Much May I Borrow?

The maximum you may borrow depends upon your grade level and dependency status. The Direct Loan amount you request may not be the amount you are eligible to receive. While the loans are not based on your ability to repay, in some cases, the applicant must demonstrate financial need or may only be eligible to borrow the annual maximum.

Borrowing can be costly. We recommend you consider borrowing only if you have exhausted all other options. Explore scholarships, grants, and Federal Work-Study opportunities at Saddleback College before deciding to borrow.

Only borrow what you need.  Make a budget for yourself to keep your debt within manageable limits. Budget your resources to live more economically.  Loans must be paid back even if you don't graduate, transfer, or are unhappy with your education or training or are unable to obtain employment.

Annual Loan Amounts


The amount in Direct Loan funds that you are eligible to borrow each academic year is limited by (1) your grade level (2) whether you are a dependent or an independent student, (3) your financial need, and (4) your cost of attendance. You cannot borrow more than your financial need or the cost of attendance (your budget.)

Dependent Student

Base Amount
(Subsidized or Unsubsidized)

Additional Unsubsidized Loan
effective July 1, 2008

Total Annual Combined Maximum Amount of Subsidized & Unsubsidized Loans

Freshman 1st year




Sophomore 2nd year






Independent Student

Base Amount
(Subsidized or Unsubsidized)

Additional Unsubsidized Loan
effective July 1, 2008

Total Annual Combined Maximum Amount of Subsidized & Unsubsidized Loans

Freshman 1st year




Sophomore 2nd year




Interest Rates

Over a four-year period beginning July 1, 2008, the interest rate on Subsidized Loans made to undergraduate students will be reduced. These rates do not affect any prior loans made to borrowers; the terms and interest rates of those loans remain the same. The applicable interest rates for loans made during this period are as follows:

UNDERGRADUATE STUDENTS - First disbursement of a loan:

Interest Rate on the Unpaid Balance of the Subsidized Loan

Interest Rate on the Unsubsidized Loan Balance

Made on or after

And made before

July 1, 2013

July 1, 2014

3.86 percent

3.86 percent

July 1, 2014

July 1, 2015

4.66 percent

4.66 percent

July 1, 2015
July 1, 2016 4.29 percent 4.29 percent

July 1, 2016
July 1, 2017 3.76 percent 3.76 percent

July 1, 2017

July 1, 2018 4.45 percent

4.45 percent

July 1, 2018

July 1, 2019 5.05 percent 5.05 percent

July 1, 2019

July 1, 2020 4.53 percent

4.53 percent

July 1, 2020
July 1, 2021 2.75 percent 2.75 percent
July 1, 2021 July 1, 2022

3.73  percent

3.73 percent

July 1, 2022

July 1, 2023 4.99 percent 4.99 percent


Loan Fees

Most federal student loans have loan fees that are a percentage of the total loan amount. The loan fee is deducted proportionately from each loan disbursement you receive. This means the money you receive will be less than the amount you borrow. You're responsible for repaying the entire amount you borrowed and not just the amount you received.

* Interest rates and origination fees are subject to change based on the date the loan was disbursed/originated and guidance provided by the Department of Education.

Exit Counseling

Federal regulations require that all student loan borrowers must have an exit interview/exit counseling during their final semester at the College. During the exit counseling, students are reminded of their rights and responsibilities as a student loan borrower. You'll receive information about repayment, and your loan provider will notify you of the date loan repayment begins. Exit Counseling can be completed online at https://studentaid.gov/exit-counseling/

Lifetime Aggregate Loan Limits

Undergraduate Dependent Students can borrow a maximum total of $31,000 (of which no more than $23,000 can be subsidized loans).

Undergraduate Independent Students can borrow a maximum total of $57,500 (of which no more than $23,000 can be subsidized loans).

Student Loan Repayment

After you graduate, leave school, or drop below half-time enrollment, you have a period of time before you have to begin repayment.  This “grace period” will be six months. 

We can't emphasize enough the importance of making your full loan payment on time either monthly (which is usually when you'll pay) or according to your repayment schedule. If you don't, you could end up in default, which has serious consequences.  Student loans are real loans—just as real as car loans or mortgages.  You have to pay back your student loans.

 Please contact  the Student Loan Support Center at (800) 557- 7394 for assistance.


Avoid default at all costs. Default means you failed to make payments on your student loan according to the terms of your promissory note, the binding legal document you signed at the time you took out your loan. In other words, you failed to make your loan payments as scheduled. Your school, the financial institution that made or owns your loan, your loan guarantor, and the federal government all can take action to recover the money you owe. Here are some consequences of default:

  • National credit bureaus can be notified of your default, which will harm your credit rating, making it hard to buy a car or a house.
  • You would be ineligible for additional federal student aid if you decided to return to school.
  • Loan payments can be deducted from your paycheck.
  • State and federal income tax refunds can be withheld and applied toward the amount you owe.
  • You will have to pay late fees and collection costs on top of what you already owe.
  • You can be sued.

If you run into financial problems with your repayment schedule, contact the Student Loan Support Center at (800) 557- 7394. There may be solutions that can keep you on track and protect your credit rating. Visit the Direct Loan Servicing Center at studentloans.gov

Saddleback College reserves the right to refuse to certify a direct loan under conditions established by 34 CFR 684.301. Students must maintain satisfactory academic progress. By signing the loan request, applicants agree to all of the terms and conditions for the Federal Direct Student loan. Eligibility requires the applicant to maintain at least half-time enrollment throughout the period of the loan and notify Saddleback College or the Federal Direct Loan Servicing Center of any changes in status such as name, address, enrollment status, and change of schools. Borrowing the low-interest, Federal Direct Loan is a privilege. Even though it is a loan, Saddleback College reserves the right to refuse to certify a loan application for high-risk borrowers. Such conditions are: • A previous default on a federal student loan. • Notification of previously discharged federal student loans due to disability or bankruptcy. • Notification of delinquent federal student loan repayment status. • Instances of inconsistent, fraudulent FAFSA, or admissions application information. • Applicants with loan indebtedness in excess of the maximum for two-year public institutions.
Loan certification requires all applicants to maintain Satisfactory Academic Progress and maintain at least half-time enrollment status. Transfer units are also reviewed for these academic requirements. Notification • Notification of loan eligibility is sent by mail. • Complete electronic Master Promissory Note (MPN) at www.StudentLoans.gov. • Saddleback College will electronically transmit loan information to the Direct Loan Servicing Center. • To indicate the loan information is received, the Direct Loan Servicing Center will send a loan disclosure notice to the applicant approximately two weeks after transmission. • Saddleback College will receive the electronic acceptance of your MPN. • Check www.nslds.ed.gov for your student loan history. Issuing Loan Funds Generally, loan funds are issued twice during the loan period but not before the official drop date each semester. The date the check is issued may vary and is subject to the availability of funds subsidized).