Direct Unsubsidized Loans:
The Direct Unsubsidized Loan Program is a federal program that allows a medical student, based on a 10 month budget, to borrow up to $42,722 for the academic year. Interest accrues (accumulates) on an unsubsidized loan from the date of the first disbursement. A student can choose to pay the interest while in school, during grace periods, deferment or forbearance periods, or they can allow the interest to accrue and be capitalized (that is, added to the principal amount of the loans).The interest rate is currently 6.21% and begins on the date of each disbursement. There is also a 1.073% Origination Fee that is deducted by Direct Lending at the time of each disbursement.
Repayment for an Unsubsidized Stafford Loan does not begin until six months after a student graduates or ceases to be enrolled at least half-time in a degree-seeking status for a period of six months. A student can, however, elect to begin repayment sooner if desired.
NOTE: The total outstanding debt a medical student can have from all Stafford Loans (Subsidized and Unsubsidized combined) is $224,000. Balances owed for Stafford Loans received from both the FFEL and Direct Loan Programs for undergraduate or graduate education are included in these aggregate totals.
Direct Grad Plus Loans
The Direct Grad Plus Loan Program is another federal loan program. The maximum amount a student may borrow is the cost of attendance for the academic year minus any other financial aid received for that same period. Types of other financial aid includes, but is not limited to: federal and private student loans, both outside and institutional scholarships, Military HPSP and assistance directly from hospitals. A credit check is required for Grad Plus Loans. If a student has adverse credit, the student may be denied by Direct Lending. If denied, the student has the right to appeal or may reapply with a credit worthy cosigner. The interest rate is currently 7.21% and begins on the date of each disbursement. There is also a 4.292% Origination Fee that is deducted by Direct Lending at the time of each disbursement.
As with the Stafford Loan Program, repayment for a Grad Plus Loan does not begin until six months after a student graduates or ceases to be enrolled at least half-time in a degree-seeking status for a period of six months.
For more information on both the Unsubsidized Stafford and Grad Plus Loan Programs, you may go to:
Pat Peace, Director of Financial Services
LMU-DCOM Financial Services Office
6965 Cumberland Gap Parkway
Harrogate, TN 37752
Office: 423.869.7107; 800.325.0900, ext. 7107