150% Direct Subsidized Loan Limit

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150% Direct Subsidized Loan Limit

Legislation went into effect for any new Subsidized Loan Borrowers


What is the 150% Loan Limit Rule?


What is the new law?

Congress enacted the "Moving Ahead for Progress in the 21st Century Act" which established time limitations on Stafford Subsidized student loans. This new law will be effective for first time borrowers or borrowers who have paid off their loans prior to July 1, 2013 and are borrowing again.

This law allows you to receive Subsidized loans only within 150% of the length of your program of study. Once you have reached this limit, you are no longer eligible to receive Subsidized students loans. For example, if you are enrolled in a two-year associate degree program, the maximum period for which you can receive a Subsidized loan is 3 years (2 years x 150% = 3 years).

Below are situations that will cause your Direct Subsidized student loan to accrue interest:

  1. You are enrolled in but have not completed your current goal and have lost subsidized loan eligibility.
  2. You lost Subsidized eligibility and did not graduate from your prior program or are enrolled in a program that is the same length or shorter than your current program.
  3. You transferred into a shorter program and had already borrowed Subsidized loans that exceeded 150% of your new program length.

You will no longer be able to receive a Subsidized loan for more than 150% of the length of you program. If you have lost eligibility for Subsidized loans, you may still quality for an Unsubsidized loan - which accrue interest while you are in school.

What should I do?

Have a goal and make steady progress toward it. If you need help clarifying your goal or which classes to take, see an Academic Counselor. Drop in hours and locations for the Counseling Office on both campuses can be found at www.santarosa.edu/counseling.