DEFINITION of 'Federal Direct Loan Program '

A program that provides low-interest loans to postsecondary students and their parents. The William D. Ford Federal Direct Loan Program is issued and managed by the U.S. Department of Education and is the only government-backed student loan program in the United States. Students who wish to apply for funding must first submit the Free Application for Federal Student Aid (FAFSA).

BREAKING DOWN 'Federal Direct Loan Program '

Several types of loans are available under the William D. Ford Federal Direct Loan Program, including subsidized direct loans, unsubsidized direct loans, Direct PLUS Loans and Direct Consolidation Loans. All loans that are granted through the Direct Loan Program have maximum amounts set each year, with each successive year allowing for an increase in the total maximum yearly amount, with set aggregate amounts.

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RELATED FAQS
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    Federal student loan rates are set by Congress, not by banks. Learn more about who gets what rate, and how often they get ... Read Answer >>
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