150% Direct Loan Subsidized Limit

On May 16, 2013, The U.S. Department of Education published the Interim Final Rule regarding MAP-21 which was signed into law by President Obama in July 2012. The changes apply to Subsidized Stafford Loan borrowers who meet the definition of “first-time borrower” on or after July 1, 2013. A first-time borrower would include a student who:

The law resulted in two key changes to Subsidized Stafford Loan for certain borrowers:

Limits

A first-time borrower may receive Subsidized Stafford Loans for a period of time not to exceed 150 percent (150%) of the published length of the educational program. A student cannot receive Subsidized Stafford Loans beyond this timeframe, unless the borrower enters a longer educational program.
Loan Timeframe
Program 150%
4 Year Program 6 Years
2 Year Program 3 Years

Enrollment Status Exception

If the student’s enrollment status is less than full-time, the subsidized usage period will be adjusted. For three-quarter time enrollment, the calculated subsidized usage period will be multiplied by 0.75, and for half-time enrollment, the calculated subsidized usage period will be multiplied by 0.50.

Loss of Subsidy

Borrowers who exceed the 150 percent limitation: For more information on this law, refer to the Department of Education’s Student Loans website.