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 student loans: Direct Subsidized, Direct Unsubsidized, Direct PLUS (for parents of dependent undergraduate students, and graduate and professional students), and Direct Consolidation.
These student 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