Student loans are a form of federal financial aid, and you must complete a FAFSA to be eligible for federal loans. Yakima Valley College participates in the Direct Loan Program, a low-interest, federal loan program.
Types of Loans
There are two forms of Federal Direct Loans: Subsidized and Unsubsidized.
- Direct Subsidized Loans do not accrue interest while the student is enrolled at least half-time.
- Direct Unsubsidized Loans begin to accrue interest at the time of disbursement. Students have the option to make interest-only payments while they are still in school for Direct Unsubsidized Stafford Loans.
There is a limit on the maximum period of time (measured in academic years) that a student can receive Direct Subsidized Loans. In general, students may not receive Direct Subsidized Loans for more than 150% of the published length of their program. For more information regarding this 150% limitation on Direct Subsidized Loans, see the Federal Student Aid website.
Federal Direct Stafford Loan Program
Federal Direct Loans are almost always less expensive than any other form of educational borrowing. They are loans that must be repaid, with interest; however, to keep these loans affordable, the federal government has established many payment plans and programs for loan deferment, cancellation, and forbearance that protect the borrower in case of disability, temporary unemployment, returning to school, etc.
The Federal Direct Stafford Loan Program provides two types of loans to YVC students. The need-based, subsidized Federal Direct Stafford Loan does not accrue interest while the student is in school (for loans taken before reaching 150% of the standard, published length of the program); while the Direct Unsubsidized Stafford Loan Program begins accruing from the point of disbursement. Loan request forms are generally available in August for the upcoming school year.
Steps for Applying for Federal Direct Loans
- Submit a FAFSA Application
- Wait for your Award Notice.
a. Your award notice will be sent to your student email address and viewable on your student Financial Aid portal.
- First-time borrowers must complete the Master Promissory Note and Loan Entrance Counseling at the Federal Student Aid website.
- Submit your Direct Loan Acceptance Form to the Financial Aid Office.
- Allow 1 to 2 weeks for processing.
Annual and Aggregate Limits for Subsidized and Unsubsidized Loans
|Year (45 credits per year)||Dependent Students||Independent Students|
|First-Year Undergraduate Annual Loan Limit||$5,500 – No more than $3,500 of this amount may be in subsidized loans.||$9,500 – No more than $3,500 of this amount may be in subsidized loans.|
|Second-Year Undergraduate Annual Loan Limit||$6,500 – No more than $4,500 of this amount may be in subsidized loans.||$10,500 – No more than $4,500 of this amount may be in subsidized loans.|
|Third and Fourth Year Bachelor’s Degree Loan Limit||$7,500 – No more than $5,500 of this amount may be in subsidized loans.||$12,500 – No more than $5,500 of this amount may be in subsidized loans.|
|Subsidized and Unsubsidized Aggregate Loan Limit||$31,000 – No more than $23,000 of this amount may be in subsidized loans.||$57,500 for undergraduates — No more than $23,000 of this amount may be in subsidized loans.|
The aggregate loan limits include any Direct Loans and any Subsidized Federal Stafford Loans or Unsubsidized Federal Stafford Loans you may have previously received under the Federal Family Education Loan (FFEL) Program.
If the total loan amount you receive over the course of your education reaches the aggregate loan limit, you are not eligible to receive additional loans. However, if you repay some of your loans to bring your outstanding loan debt below the aggregate loan limit, you could then borrow again, up to the amount of your remaining eligibility under the aggregate loan limit.
Interest Rates for Direct Subsidized Loans and Direct Unsubsidized Loans
|Loan Type||Borrower Type||Loans first disbursed on or after 7/1/2020 and before 7/1/2021 Fixed Interest Rate||Loans first disbursed on or after 7/1/2020 and before 7/1/2021 Fixed Interest Rate|
|Direct Subsidized Loans and Direct Unsubsidized Loans||Undergraduate||2.75%||4.45%|
|Direct Unsubsidized Loans||Graduate and Professional Students||4.30%||4.45%|
Other Loan Fees
Please check with the Financial Aid office for other loan fees that are subject to change from year to year.
Student Loan Default Rate
YVC student loan default rate is 10.9% for the 2018 fiscal year. The data reflects default rates for the 2018 fiscal year and was released by the ED on September 25, 2021. This rate is down from 13.80% in 2017.
For schools that had over 30 borrowers enter repayment in the 2018 fiscal year, the ED found the default rate by taking the sum of borrowers that entered repayment in 2018 and defaulted in 2018, 2019, or 2020 and divided that sum by the number of borrowers who entered repayment in 2018.
The FY 2018 national cohort default rate is 7.3%. Undergraduate students borrowed 15.9% of student loans according to the latest data reported to IPED.
Resources for Student Borrowers
One stop information on federal loans:
- Complete Master Promissory Note (MPN)
- Complete Entrance Counseling
- Complete Exit Counseling
- Resources for working with loan servicers, types of deferments, etc.
Access to private student financial aid records –awards, notices, missing documents, etc.