Federal Direct Loans are low-interest loans provided by the U.S. Department of Education to help eligible students pay for educational expenses. Unlike grants and scholarships, student loans must be repaid with interest.
To be considered for a Federal Direct Loan, you must:
- Complete the FAFSA each year.
- Be enrolled in an eligible degree or certificate program.
- Meet Satisfactory Academic Progress (SAP) requirements.
- Be enrolled at least half-time, which is 6 credit hours.
- Complete Entrance Counseling and sign a Master Promissory Note (MPN) if you are a first-time borrower.
Types of Federal Direct Loans
Direct Subsidized Loan
Direct Subsidized Loans are available to undergraduate students who demonstrate financial need.
- Interest does not accrue while you are enrolled at least half-time.
- Annual and lifetime borrowing limits apply.
Direct Unsubsidized Loan
Direct Unsubsidized Loans are available to eligible undergraduate students regardless of financial need.
- Interest begins accruing when the loan is disbursed.
- Students may choose to pay the interest while enrolled or allow it to capitalize.
Enrollment Requirements
To remain eligible for Federal Direct Loans, you must:
- Remain enrolled in at least 6 credit hours each semester.
- Continue meeting Satisfactory Academic Progress standards.
- Continue attending your classes.
If you withdraw, stop attending, or receive a failing grade because you stopped attending before completing a course, your future loan eligibility or repayment obligations may be affected.
Important Changes Beginning July 1, 2026
Federal law now requires Direct Loan eligibility to be based on your enrollment level.
- Students enrolled full-time, which is 12 or more credit hours, may qualify for their full annual loan eligibility.
- Students enrolled 6 to 11 credit hours may receive a reduced loan amount.
- Students enrolled fewer than 6 credit hours are not eligible for Federal Direct Loans.
If you add, drop, or withdraw from classes after your loan has been awarded, your remaining loan eligibility may change.
Before changing your schedule, contact the NTCC Financial Aid Office to discuss how your financial aid may be affected.
Before You Borrow
Borrow only what you need.
Remember:
- Loans must be repaid.
- Interest may accrue while you are in school.
- Borrowing more than necessary can increase your future monthly payments.
Use the Federal Student Aid Loan Simulator to estimate future payments before accepting your loan.
After You Graduate or Leave School
Most Federal Direct Loans enter repayment six months after you graduate, leave school, or drop below half-time enrollment.
If you are experiencing financial hardship, several repayment options may be available. These may include:
- Standard Repayment
- Income-Based Repayment, for eligible borrowers
- Repayment Assistance Plan (RAP) for borrowers whose loans are first disbursed on or after July 1, 2026
- Deferment
- Forbearance
Frequently Asked Questions
Do I have to be enrolled full-time to receive a loan?
No. You must be enrolled at least half-time, which is 6 credit hours, to qualify for a Federal Direct Loan.
However, beginning July 1, 2026, students enrolled less than full-time may receive a reduced loan amount.
What happens if I drop a class?
Dropping or withdrawing from classes may reduce your future loan disbursements or affect your overall financial aid eligibility.
Always contact the Financial Aid Office before changing your schedule.
What if I stop attending a class?
If you stop attending and receive a failing grade because you did not complete the course, your financial aid eligibility and future loan disbursements may be affected.
When do I repay my loan?
Repayment generally begins six months after you graduate, leave school, or drop below half-time enrollment.
Where can I view my federal loans?
Visit your StudentAid.gov account to:
- View your federal loan history.
- Complete Entrance or Exit Counseling.
- Complete your Master Promissory Note.
- Estimate monthly payments.
- Explore repayment options.
- Find your loan servicer.
Contact the NTCC Financial Aid Office
If you have questions about borrowing, repayment, or how enrollment changes may affect your loans, contact the NTCC Financial Aid Office before making changes to your schedule.
