What is a federal Direct Loan?
A Federal Direct Loan is a student loan made directly by the U.S. Department of Education.
There are four types of Direct Loans:
- Direct Subsidized Loans are given to undergraduate students who demonstrate financial need. You won’t pay or collect interest while you are in school and during the grace period after you leave school. The Department of Education pays the loan’s interest on your behalf during that time.
- Direct Unsubsidized Loans are given to any undergraduate or graduate student. It is not based on financial need. Interest will be collected while in school and included in your student loan repayment plan.
- Direct PLUS Loans are for the parents of undergraduate students, or for graduate and professional students.
- Direct Consolidation Loans are a combination of some or all your federal student loans into a single loan with one loan servicer.
You can check to see what type of loan you have through the U.S. Department of Education .