Direct Loan Interest Rates
The College Cost Reduction and Access Act reduces the interest rates over the next four years for subsidized Federal Direct Loans made to undergraduate students only. The interest rates are as follows:
| First Disbursement made on or after: | but before: | Interest Rate Subsidized & Unsubsidized Federal Direct Loan for Undergraduate Students only |
|---|---|---|
| 07/01/2023 | 07/01/2024 | 5.50% |
| 07/01/2024 | 07/01/2025 | 6.53% |
Graduate/Law
The interest rate for the Federal Unsubsidized Direct Loan for students in a Graduate/Professional degree will be:
- 7.05% for loans disbursed on or after 07/01/2023 but before 07/01/2024
- The interest rate is fixed at 8.08% for loans disbursed on or after 07/01/2024 but before 07/01/2025
Direct Loan Repayment
What may your loan payment look like?
Use the following loan chart as a guide:
| Amount of Loan Borrowed | Number of Payments | Monthly Payment Amount – 6% | Monthly Payment Amount – 7% | Monthly Payment Amount – 8% | Monthly Payment Amount – 9% |
|---|---|---|---|---|---|
| $5,500 | 60 | $106 | $109 | $112 | $114 |
| $10,000 | 60 | $193 | $198 | $203 | $208 |
| $10,000 | 120 | $111 | $115 | $121 | $125 |
| $20,000 | 120 | $223 | $233 | $243 | $254 |
| $30,000 | 120 | $334 | $349 | $364 | $381 |
| $40,000 | 120 | $445 | $465 | $486 | $507 |
To help you determine your future payments based on your Federal Direct Loan balance, go to studentaid.gov Log on using your FSA ID Username or e-mail address and your FSA ID password. Under Tools and Calculators, click on Repayment Estimator
You may also view the report for Average Student Debt Incurred at USM, by Graduation Year
Loan Default
Students who are currently in default cannot receive any federal student aid and the default will be reported to credit agencies, affecting your ability to apply for any other forms of credit. Contact the U.S. Department of Education at 1-800-4FEDAID if you are in default or if you have questions regarding the status of past loans.
Click here for helpful suggestions for Default Management (PDF -83kb)
University of Southern Maine’s FY 2021 Cohort Default Rate is 0.0%. A cohort default rate is the percentage of a school’s borrowers who enter repayment on certain Federal Family Education Loan (FFEL) Program or William D. Ford Federal Direct Loan (Direct Loan) Program loans during a particular federal fiscal year (FY), October 1 to September 30, and default or meet other specified conditions prior to the end of the second following fiscal year. Please note, if you do not meet your loan payments you risk going into default.