Federal Direct Loan Fee

All Federal Direct Loans are assessed a loan fee by the federal government. This fee helps reduce the cost of making these low-interest loans. The federal government will deduct the fee from the loan before the borrower receives any loan money; therefore, the loan funds received by the borrower may be less than the amount they will repay.

Example:

• A student borrows a $3,500 Federal Direct Subsidized Stafford Loan for the 2010-2011 academic year. Subtract from $3,500 the 1.0% loan fee ($35) and add the 0.5% interest rebate ($17.50). The net amount of loan funds the student will receive is $3482.50.

The Federal Direct Loan Servicer will mail, to the borrower, a disclosure statement indicating the exact loan terms.

 

The University of Iowa, Office of Student Financial Aid
208 Calvin Hall, Iowa City, IA, 52242-1315
financial-aid@uiowa.edu, 319-335-1450, 800-553-4692
Fax 319-335-3060

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