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Monday, May 20, 2013

New Loan Fees Announced, Starting July

As is common with a new award year, loan fees are changing for the Direct Subsidized, Direct Unsubsidized, and PLUS loans. Currently, there is a fee on these loans of 1.0% for the Subsidized and Unsubsidized loans, and 4.0% for PLUS loans.

The rates are going up to 1.051% for Subsidized and Unsubsidized loans, and 4.204% for PLUS loans. Just like with the fees currently, this is the amount of your federal loan that will not come in to the school.

The sequester took effect in March 2013, and the requirements it calls for were to take effect then. However, this fee is not included in the necessary items to take effect immediately. Dept of Ed announced that this fee would not be enforced until they had released more guidance. The announced in April that it would be enforced beginning on July 1.

The other thing you should know about this is that it affects new loans on or after July 1. If at least one disbursement was made before July 1, then your remaining disbursements on that loan will be at the lower rate. But if your loan's first disbursement is any day after July 1, then it will be at the higher rate.

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