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Understanding your federal loan options

Depending on your circumstances, you could be eligible for subsidized loans, unsubsidized loans, or both. Explore your options.

Need help understanding your financial aid choices?

Schedule a virtual meeting with the Office of Financial Aid and Scholarships.

What’s the difference between a subsidized and unsubsidized federal Direct Loan?

Let’s start with what’s the same. Both loans can help you pay for tuition, fees, housing and food, books, and other educational expenses. And both offer better interest rates and more flexible repayment plans than private lenders. But there are key differences.

Subsidized loans

You’ll only be offered a Direct Subsidized Loan if you are an undergraduate student with demonstrated financial need. If you get a Subsidized loan, the U.S. Department of Education pays any interest that accrues while you’re enrolled at least half time, for six months after you graduate, and during any deferment periods.

Unsubsidized loans

Direct Unsubsidized Loans don’t require you to demonstrate financial need and can be used to pay for both your undergraduate and graduate education. While you won’t have to begin repaying your loan until after graduation, you will be responsible for all the interest that accrues in the meantime.

How do I know if I’m eligible for a Direct Federal Loan?

As long as you’re attending IU Indianapolis at least half time and are enrolled in a program that leads to a degree, you are eligible. If you drop below half-time status, you will no longer be eligible.

How much can I borrow?

Short answer? It depends. The amount you can borrow varies depending on your year in school, whether you’re a dependent or independent student, and the type of loan you’re getting.

When do I have to start repaying my loan?

You’ll begin repaying your loans six months after you graduate or drop below half-time status. Before you hit that milestone, we’ll send you exit counseling information so you can think through your options for repaying your loans.

How do I apply for a Direct Federal Loan?

Just complete your FAFSA using school code 001813. Once we receive your information, we’ll consider you for Federal Direct Subsidized and Unsubsidized Loans as part of your financial aid package.

IU Indianapolis

Office of Financial Aid & Scholarships

Campus Center, Room 250
420 University Blvd

Indianapolis, IN 46202