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Federal Direct Student Loans

Federal Direct Student Loans are low interest loans available to students to help pay for their school expenses. Unlike other loans, a Federal Direct Loan is funded by the U.S. Department of Education rather than a bank or credit union. The Department of Education disburses the money directly to the school and the funds are applied to the student's college costs. Just like other loans, Direct Loans must be repaid by the borrower.

Federal Direct Loan eligibility requirements.

  • Student is enrolled at least half-time (6 credit hours)
  • Student must have a high school diploma or equivalent
  • Student must be matriculated (enrolled and working towards a degree or certificate program)
  • Must be a U.S. citizen or eligible non-citizen
  • Must have a valid Social Security Number
  • Students must be making satisfactory academic progress
  • Male students over the age of 18 must be registered with Selective Service
  • Student's existing Federal Direct Loans should be in good standing, not in default.
  • Students cannot exceed their aggregate loan limit

There are two types of Direct Loans for students:

Federal Subsidized Student Loan

Federal Direct Subsidized Loans are available to students that are enrolled at least half-time (6 credit hours), have financial need, and have not received financial aid exceeding their cost of attendance. The loan does not accrue interest while the student is enrolled at least half-time. 

Federal Direct Unsubsidized Student Loan

Federal Direct Unsubsidized Loans are available to students that are enrolled at least half-time (6 credit hours) and have not received financial aid exceeding their cost of attendance. Unlike the subsidized loan, the unsubsidized loan does accrue interest while the student is in school, during their grace period, and during deferment.

Loan Amounts:

For a Dependent Student

Freshmen (0-29.5 credits earned) Maximum subsidized $3500 Maximum unsubsidized $2000
Sophomore (30-59.5 credits earned) Maximum subsidized $4500 Maximum unsubsidized $2000
(Herkimer College only has Freshmen and Sophomores)
Junior and Seniors (60+ credits earned) Maximum subsidized $5500 Maximum unsubsidized $2000

For an Independent Student

Freshmen (0-29.5 credits earned) Maximum subsidized $3500 Maximum unsubsidized $6000
Sophomore (30-59.5 credits earned) Maximum subsidized $4500 Maximum unsubsidized $6000
(Herkimer College only has Freshmen and Sophomores)
Junior and Seniors(60+ credits earned) Maximum subsidized $5500 Maximum unsubsidized $6000

How to secure a Federal Direct Student Loan:

To receive a student loan,  students must complete the FAFSA form.  Information from the FAFSA form will determine the type(s) of loans (subsidized and/or unsubsidized) the student is eligible for.  Before the loan is disbursed to the students account, the student must complete Direct Loan Entrance Counseling. This counseling informs students of their rights and responsibilities as a student loan borrower, how and when repayment works and terms of the loan they are borrowing. 

Read the Direct Loan Entrance Counseling Guide

When a student is no longer enrolled for at least 6 credit hours, he/she must complete Direct Loan Exit Counseling. This is similar to the entrance counseling reminding students of their promise to repay the loan(s) and the various repayment plans available to the student.

Download the Direct Loan Exit Counseling Guide

Duration: Awarded Annually. Aggregate loan limits for undergraduate students are as follows:

Dependent students - $23,000 subsidized loans, total loans not to exceed $31,000

Independent students - $23,000 subsidized loans, total loans not to exceed $57,500

Repayment: All Federal Direct Student Loans are assigned to a servicer that will assist the student in the loan repayment process. Students can access the NSLDS website to determine which servicer will process their loan. 

You’re not alone when it comes to repaying your student loans. Herkimer College has partnered with Inceptia, a division of National Student Loan Program (NSLP), to provide you with FREE assistance on your Federal student loan obligations to ensure successful, and comfortable, loan repayment. Inceptia’s friendly customer representatives may reach out to you during your grace period to answer questions you have about your loan obligation and/or repayment options. Inceptia is not a collection agency. We’ve partnered with them to inform you of a wide variety of possibilities such as alternative repayment plans, deferment, consolidation, discharge, forgiveness, and forbearance options. Inceptia will stay in touch with you via phone calls, letters, and/or emails to help you understand your repayment timing and options.

For additional resources including information on repayment options, please visit Inceptia’s Federal Student Loan Overview website 

FSA Ombudsman: If you have made a reasonable effort to resolve a problem or dispute with your student loan through normal processes and it is still not resolved, you can contact the Ombudsman Office.
An ombudsman resolves disputes from a neutral, independent viewpoint. The Federal Student Aid (FSA) Ombudsman will informally conduct impartial fact-finding about your complaint. They will recommend solutions, but they do not have the authority to make or reverse decisions. They will also work to bring about changes that will help prevent future problems for other student loan borrowers. This free service is provided by the U.S. Department of Education.


The Ombudsman will research your problem and determine whether you have been treated fairly. If your student loan complaint is justified, they will work with you and the office, agency or company involved in the problem. On your behalf, they will contact other offices with the U.S. Department of Education, your private lender, your loan guaranty agency, and the servicing agency or firm collecting your loan.If your complaint is not justified, they will take the time to explain to you how they reached their conclusion.


To contact the Ombudsman:
customerservice@studentaid.gov
U.S. Department of Education
Federal Student Aid Information Center
PO Box 1854
Monticello, KY 42633

Institutional Borrower Repayment Data

Herkimer College's cohort default rate from 2018 is 19%. The national average cohort default rate is 15%. The college's repayment rate is 38.1% and the national repayment rate is 44.7%.

Loan Servicer

The Department of Education will assign a loan servicer after your loan is first disbursed. To identify your loan servicer visit your account dashboard at studentaid.gov and scroll down to the "My Loan Servicers" section or call the Federal Student Aid Information Center (FSAIC) at 1-800-433-3243 or 1-800-4-FED-AID

Loan Contact Information

General Information about loans and applying for them

Information on Consolidating your loans

Loan Servicers