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Types of Direct Loans

Subsidized Direct Loan

A Federal Subsidized Direct Loan is for students who demonstrate financial need, which is determined by federal regulations. These loans do not accrue interest while you are in school as at least a half-time student (6 units or more), during your grace period, and during your deferment periods. Interest begins to accrue once you enter repayment.

Unsubsidized Direct Loan

Federal Unsubsidized Direct Loans are not based on financial need. The interest begins to accrue after your first disbursement. Interest accrues during all time periods including the time you are at school, grace periods, and deferment periods.

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Loan Amounts

The Direct Loan amount you request may not be the amount you are eligible to receive. PCC determines your amount of eligibility based on the Admissions and Records grade level at the time of certification. We also determine the maximum amount of eligibility based on other factors such as your current student cost of attendance budget and financial aid awards.

*Note: For Sub/Unsub Direct Loans disbursed after 07/01/2024 and before 07/01/2025, the interest rate is fixed at 6.53%.

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Direct Loan Eligibility Requirements 

Requirements and criteria needed for a student loan:

1. All loan requests must be filled out completely and are reviewed on a case by case basis.

2. You must be enrolled in at least 6 degree applicable units. If you drop below 6 units, this will result in the cancellation of all loan funds and/or return of any remaining funds. You will also be required to complete Loan Exit Counseling at studentaid.gov.

3. You must maintain Satisfactory Academic Progress (SAP) and have a status of Good or Warning for terms applying for loans and have a 2.0 Cumulative GPA at the time of Disbursement.  

4. Having an Appeal approved does not mean that your loan request will be automatically approved.

5. As part of our default prevention plan, student loan applicants must meet with an academic counselor to obtain a Comprehensive Educational Plan and ensure academic goals and progress.

6. All documents must be uploaded through your LancerPoint student portal by the loan application deadlines.

7. The total financial aid awards, including loans, cannot exceed a student’s cost of attendance. Loan amounts may be adjusted to accommodate new awards such as grants, scholarships or other types of resources.

8. You must complete an electronic Master Promissory Note (MPN) online at studentaid.gov.

9. As part of our default prevention plan, all student loan applicants must complete the Loan Entrance Counseling at studentaid.gov.

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First Time Borrowers vs. Returning Borrowers at PCC

You are a first-time borrower if you have not received a prior Subsidized/Unsubsidized Direct Loan, Subsidized/Unsubsidized Federal Stafford Loan, or Federal SLS Loan. As a first-time borrower at PCC, there is a 30-day "waiting period" before the first disbursement of loan funds. Returning borrowers can expect their disbursement as early as the first day of the semester. 

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Disbursement

Loans are disbursed once per semester during the loan period, as early as the first day of the semester. If you are a first-time borrower, disbursement will be held ("waiting period") until you have passed the 30th day of enrollment. For loans that are one semester only, the loan will be disbursed twice in the semester. The first disbursement will be scheduled at the beginning of the semester and the second disbursement will be scheduled at the mid-point of the semester.

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Loan Repayment

Repayment of your loan will begin six months after you graduate, withdraw, or drop below half-time. Avoid defaulting on your student loans at all costs. If you run into financial problems with your repayment schedule, contact the Direct Loan Servicing Center at 1-800-848-0979. There may be solutions that can keep you on track and protect your credit rating.

For tips on managing loan debt visit the Higher Education Loan Service Center and Cash Course for financial literacy information.

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