Federal Direct Loan Program


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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  1. Does interest on my student loan accumulate during forbearance?

    The interest on your account is calculated and capitalized, or added to the principal loan amount, during a forbearance. ... Read Full Answer >>
  2. Who is eligible for student loan forgiveness?

    Your eligibility for student loan forgiveness depends on the type of student loan in question. If you have a federal loan, ... Read Full Answer >>
  3. What’s the difference between the two federal student loan programs (FFEL and Direct)?

    The short answer is that one loan program still exists (Federal Direct Loans) and one was ended by the Health Care and Education ... Read Full Answer >>
  4. Can Sallie Mae loans be forgiven?

    Sallie Mae loans, similar to other private loans, cannot be forgiven. As of 2015, there is no option for private student ... Read Full Answer >>
  5. Can Sallie Mae loans be consolidated?

    Sallie Mae loans can be consolidated with other federal loans, but not with private loans. For federal loan consolidation, ... Read Full Answer >>
  6. How does Sallie Mae disburse funds?

    Sallie Mae is the number one provider of financial aid and student loans in the United States, servicing over 25 million ... Read Full Answer >>

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