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Latest From FSA: Determining a Student’s Eligibility for a Direct Subsidized Loan When the Remaining Eligibility Period is Less Than One Year

October 20, 2015

FSA recently released an announcement to address questions regarding whether a student whose Remaining Eligibility Period is less than one year is eligible for a Direct Subsidized Loan.

Per the release, “An otherwise eligible student can receive a Direct Subsidized Loan when that student has a Remaining Eligibility Period that is one year or greater. However, there are special considerations if the student’s Remaining Eligibility Period is greater than zero years, but less than one year. These students can receive a Direct Subsidized Loan if:

  • The school can originate a Direct Subsidized Loan in compliance with all Direct Loan origination rules as provided in the regulations at 34 CFR 685.301, with particular attention to the applicable minimum loan period rules, as discussed below; and
  • The loan’s loan period, academic year, enrollment status, and loan amount results in a Subsidized Usage Period that is equal to or less than the student’s Remaining Eligibility Period.”

For full details concerning the eligibility of these students, see the electronic announcement.

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