Federal Direct Loan Program (FDLP)
Under the Federal Direct Loan Program (FDLP, also known as Direct), the US Department of Education makes a loan through the student’s school to help a student or parent pay the costs of the student’s education beyond high school.
The FDLP offers several types of loans: Direct Subsidized, Direct Unsubsidized, Direct PLUS (for parents of dependent undergraduate students, and graduate and professional students), and Direct Consolidation.
These loans have several advantages over private loans issued by a bank or other financial institution:
- Interest rates are low
- Application and approval processes are uncomplicated
- Loans are available to both students and parents
- Direct Subsidized and Direct Unsubsidized loans aren’t contingent upon a credit check
- A student is not required to make payments on a Direct Subsidized, Direct Unsubsidized, or Direct Student PLUS loan while enrolled in school on at least a half-time basis; in addition:
- For Direct Subsidized or Direct Unsubsidized loans, borrower aren’t required to make payments for the six-month period after they drop below half-time enrollment
- For Direct PLUS loans first disbursed on or after July 1, 2008, student borrowers can defer payments for the six-month period after they drop below half-time enrollment
- The federal government pays the interest on certain loans while the student is in school on at least a half-time basis, in a grace period, or in a period of deferment
- Parents can defer payments on Direct Parent PLUS loans while they’re enrolled in school on at least a half-time basis. In addition, for a Direct Parent PLUS loan first disbursed on or after July 1, 2008, a parent, upon his or her request, can defer payments:
- For the six-month period after the parent drops below half-time enrollment
- While the student for whom the parent borrowed is enrolled at least half time, and for the six-month period after the student drops below half-time enrollment