Federal Direct Subsidized/Unsubsidized Student Loans

With the Federal Direct Subsidized/Unsubsidized Loan Program you borrow loan funds directly from the Federal Government. Like any loan, Subsidized/Unsubsidized Loans must be repaid. After your loan is disbursed, your loan will be assigned to a Department of Education Federal Loan Servicer. Keep all communication that you receive as you will need to remember and know which service has your loan(s). Subsidized and Unsubsidized Loans for undergraduate students with a first disbursement between July 1, 2022 and June 30, 2023 have a fixed interest rate of 4.99%. Unsubsidized Direct Loans for graduate students with a first disbursement between July 1, 2022 and June 30, 2023 have a fixed interest rate of 6.54%. The current loan fee for Subsidized/Unsubsidized Loans disbursed between October 1, 2020 and September 30, 2023 is 1.057%. (Check with your loan servicer for the interest rate in effect for your previous borrowing for Subsidized/Unsubsidized Loans.) While you are in school, the Federal Government pays interest on the Subsidized Direct Loan for you; however, you are responsible for the interest that accrues on the Unsubsidized Loans. Effective with loans first disbursed on or after July 1, 2012, Subsidized Loans are no longer available to graduate borrowers.

Students who began their academic career at South Dakota Mines, borrowed federal student loans (Direct, Perkins and/or Stafford) while attending and graduated from South Dakota Mines with a Bachelors Degree during the 2020-2021 academic year had an average indebtedness for these types of loans of approximately $27,028. Using the current maximum interest rate on a Direct Loan of 8.25% for undergraduate students (check your loan disclosures if you have borrowed previously), this would result in an approximate monthly payment of $332. Students are under no obligation to accept a student loan and should do so only after considering the long-term implications of borrowing.

Your award notification on Financial Aid Self-Service shows the eligible loan program and the maximum amount you are eligible to receive based on your grade level, Estimated Cost of Attendance, Expected Family Contribution and other financial aid you are receiving. You are under no obligation to accept a student loan.

Subsidized and Unsubsidized Loan payments are deferred as long as you are enrolled on at least a half-time basis. After you cease to be enrolled at least half-time, you will receive a one-time six-month grace period before entering repayment on the loan(s). Repayment will be according to the provisions of your Master Promissory Note (MPN). You are expected to contact your loan servicer when you graduate or cease to be enrolled on at least a half-time basis.

First-time Direct Loan borrowers must complete a Master Promissory Note (MPN) and Loan Entrance Counseling.