Federal Loans

These page provide an overview of the:

• Types of loans available
• Interest rates
• Repayment

For all other information, please see our main page.

Direct Federal Loan

Subsidised Loan - is a federally subsidized loan, which means that there are no interest charges while you are enrolled at least half time, and for six months after you leave school or drop below half time. This six month period is called a grace period. 

Unsubsidised Loan - is not based on financial need. You are responsible for payment of interest for the full period of the loan. Whilst studying at least half time, or during deferment or grace periods you have the option of paying the interest or having it capitalised and added to the total value of the loan.

Graduate PLUS loan for Professional Students

Students will be subject to a stringent credit check.  Title IV rules apply, as do audit requirements. Students must have exhausted all their Direct loan options both subsidised and unsubsidised before applying for a PLUS loan.

For Graduate PLUS loans a graduate borrower automatically receives an additional six month deferment after the borrower ceases at least half time enrolment.

ParentPlus Loan

Parents of dependent undergraduates can take out a ParentPlus Loan under their name. Parents can borrow up to their child’s cost of attendance, as calculated by the Foreign School. These loans start repayment while the child is in school.

If you're a parent PLUS borrower, you can defer repayment of Direct PLUS Loans while the student for whom you obtained the loan is enrolled at least half time, and for an additional 6 months after the student graduates or drops below half-time enrollment (half-time enrollment status is determined by your child's school). You must separately request each deferment period.

Interest that accrues during these periods will be capitalized if not paid by the parent during the deferment.

Interest Rates and Charges

For full details of the interest rates associated with US Federal loans please refer to https://studentaid.gov/understand-aid/types/loans/interest-rates.

For Federal loans first disbursed between 1^st July 2024 and 30^th June 2025 the interest rates are as follows:

The interest rate on a Plus loan is fixed at 9.08%.

The interest rate on a Direct subsidised or unsubsidised for undergraduate students is fixed at 6.53%. For graduate or professional studies unsubsidised loans the rate is fixed at 8.08% 

In addition there is an origination fee for Direct loans, both subsidised and unsubsidised, first disbursed between 1^st October 2020 and 1^st October 2026 of 1.057%(net), which is deducted at source prior to the disbursement of the loans. The origination fee for Parent PLUS and Graduate PLUS loans first disbursed between 1^st October 2020 and 1^st October 2026 is 4.228%(net).

Please be aware that private loans will incur a commercial interest rate. Look at interest rates and charges with different lenders. A lender may require someone else with a good credit rating as a guarantor or as a co-borrower.

Borrow what you need, but remember you must repay it.

Repayment of Federal Loans

Repayment of Federal loans is a very serious obligation. There are a number of repayment options available to help borrowers to meet their obligations.

Remember, you are required to make your student loan payments even if you:

• do not complete your education
• are not employed upon completion of your studies;
• do not find employment in your field of study;
• feel that the education you received did not meet your expectations;
• do not receive a bill;

You must make your loan repayments on time or it may have serious consequences. It may:

• damage your credit rating, which could impact your ability to borrow
• refer your account to a collection agency
• incur collection costs
• cause garnishment of your wages
• cause withholding of your state or Federal treasury payments (including federal tax refunds, Social Security benefits, etc.)
• cause a civil lawsuit, including court costs and legal expenses
• cause loss of deferment and forbearance entitlements and flexible repayment options
• cause loss of eligibility for further financial aid
• suspend your professional license

Repayment options

There are a number of repayment options available. You should discuss them with your lender to determine which will be the best for you:

• Standard Repayment
• Graduated Repayment
• Extended Repayment
• Income-Based Repayment
• Pay As You Earn Repayment
• Income-Contingent Repayment
• Income-Sensitive Repayment

For full details see the Department of Education Loan Repayment webpages