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Smart Borrowing

Be Smart

Student Loans are a good way to finance your education; however, just like car loans, mortgages and even credit cards, student loans are loans and must be repaid by the student or the parent, depending upon who takes the loan out.

Student loans have limits. Be sure to read the information below to understand the maximum amounts that are available both per academic year and the lifetime limits (otherwise known as loan aggregates). 

It's important that you Know Your Debt.

Key things to remember about using student loans:

  1. Borrow only what is necessary to finance your education.
  2. Look for alternatives to borrowing, such as scholarships, grants, work study.
  3. Use the budgeting tools we have available.
  4. Contact your financial aid counselor to discuss smart borrowing and establishing a plan to finance your academic program.
  5. Contact Career Services to look for employment opportunities.
  6. Review our Know Your Debt Loan Counseling presentation. It's a self-guide, presentation that provides great information about loans and borrowing carefully.
  7. NSLDS is a government web site where students can track and monitor all of their government student loans.
  8. Students have the right to cancel or reduce their student loan prior to disbursement. Contact your financial aid counselor for more information.
  9. Print and complete the Know Your Debt checklist.

Know What U Owe

Find out "What U Owe" at NSLDS (National Student Loan Data System)

To review your loan history you will need:

  • Your Social Security number
  • The first two letters of your last name
  • Birth Date
  • The Federal PIN used to sign your FAFSA

Fact: There are Limits to What You May Borrow!

The maximum amount you can borrow each year in Direct Subsidized and Unsubsidized Loans depends on your grade level and on whether you are a dependent student or an independent student. The following table shows the maximum amount of money you may borrow each academic year in Direct Subsidized and Unsubsidized Loans:

Annual Limits Dependent Student (1) Independent Student(2)

1st-year undergraduate

$5,500 (maximum $3,500 subsidized) $9,500 ($3,500) (3)

2nd-year undergraduate

$6,500 ($4,500) $10,500 ($4,500)

3rd- and 4th-year undergraduate

$7,500 ($5,500) $12,500 ($5,500)

Graduate/professional

NA (All graduate and professional students are considered independent.) $20,500

(1) Except those whose parents are unable to borrow a PLUS loan.
(2) These limits also apply to dependent students whose parents are unable to borrow a PLUS loan.
(3) The numbers in parentheses represent the maximum amount that may be subsidized.

The actual loan amount you are eligible to receive for an academic year is determined by your school and may be less than the maximum annual amounts shown in the chart above.

Maximum Life-time Limits (Aggregates)

Below are the aggregate (total) limits for Direct Subsidized and Unsubsidized Loans:

  • $31,000 for dependent undergraduate students excluding those whose parents are unable to borrow a PLUS Loan (no more than $23,000 may be subsidized)
  • $57,500 for independent undergraduate students and dependent undergraduates whose parents are unable to borrow a PLUS loan (no more than $23,000 may be subsidized)
  • $138,500 for graduate or professional students (no more than $65,500 may be subsidized; includes loans for undergraduate study)

These aggregate limits include both Direct Subsidized and Unsubsidized Loans and any subsidized and unsubsidized Federal Stafford Loans received through the Federal Family Education Loan (FFEL) Program.

NSLDS, as mentioned above, is a government web site where students can track and monitor all of their government student loans.

With a Direct PLUS Loan, a graduate/professional student or the parent of a dependent student can borrow up to the cost of the student's attendance minus other financial aid the student receives.

Smart borrowing means limiting your borrowing so that you do not reach your aggregates prior to graduating with your intended degree. It also means graduating with minimal debt. Talk with your advisor or financial aid counselor to establish a plan for minimizing the debt you take on while attending Davenport.