Educational Loans
Federal Direct Loan Program
Portland State University participates in the Federal Direct Loan program. Under this program, funding for student loans comes from the U.S. Treasury and is disbursed by schools. When loan repayments are due, borrowers repay them directly to the federal government through a loan servicer assigned by the U.S. Department of Education. Any subsequent loans are then serviced by the assigned loan servicer. Undergraduate and post-baccalaureate students can borrow Federal Direct Subsidized and Unsubsidized Loans. Graduate students can borrow Federal Direct Unsubsidized Loans. The Federal Direct Graduate PLUS Loan is not available for new borrowers. Only graduate students who meet both credit and legacy requirements may receive this loan. Parents of dependent students can apply to borrow Federal Direct Parent PLUS Loans
Federal Direct Loan applicants must submit a FAFSA to have their loan eligibility determined. After their loans have been awarded, they must accept them as part of their financial aid award acceptance process, and complete Master Promissory Note and satisfy entrance counseling requirements at www.studentaid.gov.
Federal Direct Subsidized Stafford Loan
Subsidized loan eligibility is based upon the demonstration of financial need and in conjunction with other sources of student assistance. The federal government pays the interest on this loan while the student is enrolled at least half-time and during the six-month grace period directly after a student separates from school. For students who are new borrowers after July 1, 2013, interest is paid by the federal government up to 150 percent of the published length of the academic program. The student is responsible for all interest on the loan once repayment begins or after 150 percent of the published length of the academic program is exceeded.
The federal government has set annual borrowing limits of $3,500 for the first academic year of undergraduate study (up to 44 credits); $4,500 for the second academic year (45–89 credits); and $5,500 an academic year for the remaining years of undergraduate study. Not all students are eligible for the maximum loan amount.
Student borrowers must be enrolled in good standing at least half-time and have been accepted for admission to a program leading to a degree or eligible certificate. Once repayment begins, borrowers are charged the interest rates that were in effect for each year they borrowed. For current interest rates, visit the Department of Education’s website at www.studentaid.gov/understand-aid/types/loans/interest-rates.
Students must complete a FAFSA each year to participate in this loan program.
Federal Direct Unsubsidized Stafford Loan
This program provides unsubsidized Federal Direct Loans to undergraduate and graduate students who do not demonstrate federally defined need. Unsubsidized loans are not eligible for the federal government payment of interest while the student is in school. The student may make interest-only payments while in school, or the interest will be added to the loan balance upon entering repayment. The interest rates for the Federal Direct Unsubsidized Loan are specific to each year that the student borrows. For current interest rates, visit the U. S. Department of Education’s website at hwww.studentaid.gov/understand-aid/types/loans/interest-rates. Students are responsible for the interest that accrues while in school, during their six-month grace period, and during any authorized deferment periods. The federal government has set annual borrowing limits of $2,000–$5,500 for the first academic year of undergraduate study (up to 44 credits); $2,000–$6,500 for the second academic year (45–89 credits); and $2,000–$7,500 an academic year for the remaining years of undergraduate study. Undergraduate borrowing limits vary based on the borrower's dependency status as indicated by the FAFSA. Graduate students may borrow up to $20,500 per year.
Lifetime (aggregate) Federal Direct Loan Borrowing Limits by Academic Program
A dependent undergraduate or post baccalaureate student may borrow an aggregate limit of $31,000 (only $23,000 may be subsidized). An independent undergraduate or post baccalaureate student may borrow an aggregate limit of $57,500 (only $23,000 may be subsidized). The One Big Beautiful Bill Act, implemented 07/01/2026, changed the borrowing limit for students who do not qualify as Legacy. Starting 07/01/2026, new federal student loan borrowers will have a combined lifetime borrowing maximum on all federal student loans of $257,500 (excluding PLUS loan amounts). The new borrower aggregate limit for a graduate non-professional student is $100,000 (not including undergraduate loans). New professional students have an aggregate limit of $200,000. For graduate or professional students who qualify as Legacy, the aggregate limit remains $138,500 (this includes undergraduate loans. Only $65,500 of this may be subsidized).
Additional Federal Direct Unsubsidized Stafford Loan
Dependent undergraduate students whose parents' Federal Direct Parent PLUS Loan applications are denied may be eligible for additional Federal Direct Unsubsidized Loan. Students who have earned fewer than 90 credits may borrow up to $4,000 a year in additional funds above the maximum Federal Direct Loan annual limits (but may not exceed aggregate limits). Students who have earned 90 credits or more may borrow up to an additional $5,000 per year (but may not exceed aggregate limits). Not all applicants will qualify for the maximums in additional funding. The Federal Direct Unsubsidized Loan may be used to replace the Expected Family Contribution, but total Federal Direct Loan (subsidized and unsubsidized) borrowing, plus other financial assistance received, cannot exceed the Cost of Attendance.
Students must complete a FAFSA each year to participate in this loan program.
Federal Direct Parent PLUS Loan (PLUS)
This program provides loans to parents of dependent undergraduate students. The Federal Direct Parent PLUS Loan is limited to parents who do not have adverse credit history or who have obtained an endorser who does not have adverse credit history. A servicer, contracted by the federal government, performs the required credit check. The interest on the Federal Direct PLUS Loan is fixed. For current interest rates, visit the U.S. Department of Education’s website at www.studentaid.gov/understand-aid/types/loans/interest-rates.
The One Big Beautiful Bill Act, implemented 07/01/2026, created annual and aggregate limits for the Parent PLUS loan. Students who qualify as Legacy are excluded from these limits. Starting 07/01/2026, eligible parents may borrow an annual maximum of $20,000 with an aggregate limit of $65,000 per student. Within these new limits, parents may borrow up to an annual amount that is equal to the Cost of Attendance minus any financial assistance the student receives during the periods of enrollment. The parent borrower may use the amount of the Federal Direct PLUS to replace the Expected Family Contribution and cover unmet need for the loan period. The Parents of qualifying legacy students may continue to borrow without these new annual or aggregate limits.
Parents interested in participating in the Federal Direct PLUS Loan program can apply online at www.studentaid.gov.
Students must complete a FAFSA each year for their parent to participate in this loan program.
Federal PLUS Loan for Graduate and Professional Students (Graduate PLUS)
The Federal Direct Graduate PLUS Loan will not be available to new borrowers starting 07/01/2026. This loan program is being sunsetted by The One Big Beautiful Bill Act. After that date, it will only be available for qualifying Legacy borrowers. This program is available to credit-qualified graduate students with or without financial need. Repayment begins within sixty days after the Federal Direct Graduate PLUS Loan is fully disbursed. Students who meet deferment requirements may obtain an in-school deferment from the U.S. Department of Education. Interest is fixed for each loan, and begins to accrue at the time the first disbursement is made. For current interest rates, visit the Department of Education’s website at www.studentaid.gov/understand-aid/types/loans/interest-rates.
Students must complete a FAFSA each year to be eligible for Federal Direct Graduate PLUS Loans.
Private Alternative Loans
Privately funded education loans are not based on need, and no federal formula is applied to determine eligibility. The amount borrowed cannot exceed the Cost of Attendance minus other financial aid, including other loans. Interest rates and repayment terms vary by lender, and should be carefully considered when making borrowing decisions. Privately funded education loans may be used to supplement the federal programs when the cost of attendance minus the maximum federal aid still leaves unmet need. For information on alternative loans, visit the PSU website at www.pdx.edu/student-finance/financial-aid/apply.