Loans | JCTC


Some things to know about the Direct Loan Program:

Payments are made to the U.S. Department of Education.

Students do not have to start repayment until six months after they graduate or they fall below half-time status. However, you can make payments at any time towards your loan.

The U.S. Department of Education pays (subsidizes) the interest while the borrower is in school and during grace and deferment periods on subsidized Direct Loans. The borrower is responsible for paying the interest that accrues on unsubsidized Direct Loans.

You have a grace period of 6 months after you graduate, leave school or drop below half-time status before you must begin repayment on a loan.  During the grace period on a subsidized loan you don't have to pay any principal and you won't be charged interest.  On an unsubsidized loan you don't have to pay any principal, but you will be charged interest.  You can either pay the interest as you go along or it will be capitalized (i.e., added to the principal loan balance) later.

Common Rules: There are also some rules that apply to all student borrowers. They include:

    • All students must complete the FAFSA (this must also be completed for Parent PLUS Direct Loans)

    • All students must meet the general eligibility requirements for financial aid

    • All students will go to KCTCS Student Services Center and enter their e-ID and password to accept their Direct Loan(s) (Exception Parent PLUS Direct Loans are noted below)

Student Borrowers: All students wishing to apply for a Direct Subsidized Loan and/or Direct Unsubsidized Loan need to complete the following: 

Parent Borrowers: Parent borrowers wishing to apply for a Direct Parent PLUS Direct Loan are required to complete the following:

One lender one choice.  Direct Loans are never sold by the federal government, so student borrowers always know who holds their loans and the terms of their loans.  FFELP (i.e., Stafford) loans are frequently sold, with promised benefits not honored by the new loan holder(s).  Borrowers will be able to consolidate their previous FFELP loans with their direct loans for free through the Federal Direct Consolidation Program.  Loans are able to be processed quickly with only one lender involved resulting in a smoother student loan delivery process.  Federal Direct Loans offer a true, income contingent loan repayment option with loan forgiveness after 25 years of repayment.  Borrowers with a desire to work in relatively low-paying, community service jobs can do so while minimizing the fear of defaulting on the repayment of their student loans.  Direct Lending has the new Public Service Loan Forgiveness program that will forgive remaining debt after 10 years of eligible employment and qualifying loan payments for people working in key public service professions such as teaching, government, social work, law enforcement, and non-profit 501(c)(3) organizations.  Under the Direct Loan Program the Parent PLUS Interest Rate is 7.9%.  Under FFELP the Parent PLUS Interest Rate was 8.5%.

Federal Student Direct loans can be consolidated along with outstanding student loan debt from FFELP (i.e., Stafford Loans).  After graduation you have a choice.  You may either make individual payments to your previous lender(s) for FFELP and the Department of Education for Direct Loans.  However, if you do not want to consolidate your FFELP and Direct Loans, you will have to make separate payments to the different loan servicers.

For information on consolidation or an application to consolidate go to the Federal Direct Consolidation website.

Yes, the eligibility requirements and loan amounts are the same.  The Department of Education acts as a lender, providing funds for Direct Loans and Parent or Grad PLUS loans in the same amounts as the Stafford and Parent or Grad PLUS loans offered through the Federal Family Education Loan Program.  In FFELP, banks and other private lenders provide these loans.

No, you will not be able to choose a private lender for receiving a new loan, as the Department of Education is the only student loan lender after July 1, 2010.

Federal regulations require that when an undergraduate student is enrolled in a program that is one academic year or more in length, but is in a remaining period of study that is shorter than a full academic year, their Federal Direct Loan amount must be prorated.

Students who graduate in Fall term will have their Federal Direct Loans prorated during their final semester.  The loan limit proration determines the maximum loan amount that a student may borrow for the final term of study based on the degree they are earning.

It is important to notify the student financial aid office if you are graduating in the summer or fall terms.  Your loans could be adjusted after disbursement which could result in a bill with the college.

Use the chart below to determine your eligibility.


Dependent Student

Credit Hours in Final Semester   Subsidized Loans   Unsubsidized Loans   Total Combined  
12 $2250 $1000 $3250
11 $2070 $920 $2990
10 $1890 $840 $2730
9 $1710 $760 $2470
8 $1485 $660 $2145
7 $1305 $580 $1885
6 $1125 $500 $1625

Independent Student

Credit Hours in Final Semester   Subsidized Loans   Unsubsidized Loans   Total Combined  
12 $2250 $3000 $5250
11 $2070 $2760 $4830
10 $1890 $2520 $4410
9 $1710 $2280 $3990
8 $1485 $1980 $3465
7 $1305 $1740 $3045
6 $1125 $1500 $2625

 Changing from FFELP to Direct Lending will not affect your loan eligibility because Direct Loans are subject to many of the same regulations as FFELP loans.  For instance, students must meet satisfactory academic progress and be within their aggregate loan limits to receive any kind of federal loans.  

The National Student Loan Data System has information about your federal student loans.  It is important that you keep track of your student loan debt.  To review your loan information, you can log in to  You will need your PIN number from your FAFSA.