What are the interest rates?
The federal interest rate varies depending on the loan type and when the first disbursement occurred. The table below provides interest rates for Direct Loans (Subsidized, Unsubsidized, Parent PLUS, and Graduate PLUS) first disbursed on or after July 1, 2024, and before July 1, 2025.
|
Undergraduate Borrowers |
Graduate or Professional Borrowers |
Parents and Graduate or Professional Borrowers |
|
6.533% |
8.083% |
9.083% |
|
Subsidized and Unsubsidized Loans |
Unsubsidized Loans |
Parent PLUS and |
The table below provides interest rates for Direct Loans (Subsidized, Unsubsidized, Parent PLUS, and Graduate PLUS) first disbursed on or after July 1, 2023, and before July 1, 2024.
| Undergraduate Borrowers | Graduate or Professional Borrowers | Parents and Graduate or Professional Borrowers |
| 5.50% | 7.05% | 8.05% |
| Subsidized and Unsubsidized Loans | Unsubsidized Loans | Parent PLUS and Graduate PLUS Loans |
The interest rates shown above are fixed rates (e.g., will not change for the life of the loan). If your loan was disbursed before July 1, 2023, you likely have a different interest rate. View interest rates for loans disbursed earlier.
Interest rates on federal student loans are set by federal law, not the U.S. Department of Education. Find out how interest is calculated here.
What is the loan fee?
All Direct Loans have a loan fee. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement.
| Loan Type | Loan Fee (if first disbursed on or after Oct. 1, 2020) |
|---|---|
| Undergraduate Subsidized/Unsubsidized Loans | 1.057% |
| Graduate Unsubsidized Loans | 1.057% |
| Parent and Graduate PLUS Loans | 4.228% |
Loans disbursed before Oct. 1, 2020 had different loan fees.
How to Apply for Federal Direct Loans
To apply, you must first complete and submit the Free Application for Federal Student Aid (FAFSA®) form. The information from your FAFSA is used to determine how much student aid you are eligible to receive. If you are offered a new Federal Direct Loan(s) at any time you must accept this loan before the last day of the term and/or the last day of the last term you attended in the academic year. The Following must be completed before any funds are disbursed to your student account:
Please Note: Any time your Financial Aid changes, a revised notification is sent to your ERAU email. At such time, you should review your revised Financial Aid Offer by logging into ERNIE and view your Campus Solutions Student Homepage > Financial Aid.
The following chart shows the annual and aggregate limits for subsidized and unsubsidized loans.
| Grade Level | Dependent Students | Independent students and dependent students whose parents are denied a PLUS |
|---|---|---|
| Freshman 0-27 hours earned |
$5,500 per academic year; No more than $3,500 can be in subsidized loans |
$9,500 per academic year; No more than $3,500 can be in subsidized loans |
| Sophomore 28-57 hours earned |
$6,500 per academic year; No more than $4,500 can be in subsidized loans |
$10,500 per academic year; No more than $4,500 can be in subsidized loans |
| Junior/Senior 58+ hours earned |
$7,500 per academic year; No more than $5,500 can be in subsidized loans |
$12,500 per academic year; No more than $5,500 can be in subsidized loans |
| Graduate or Professional | Not Applicable | $20,500 per academic year; Unsubsidized Loans only |
| Total Aggregate Loan Borrowing Limit | $31,000 undergraduate total; No more than $23,000 can be in subsidized loans |
$57,500 undergraduate total; $138,500 graduate total; Includes all undergraduate federal student loans borrowed |
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 federal 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. For more information, please visit https://studentaid.gov/understand-aid/types/loans.
As a transfer student, it is your responsibility to know your annual and lifetime loan borrowing limits for Federal Student Loans and have all pending disbursements cancelled at your previous school before transferring to ERAU. This ensures a more accurate aid offer.
Before accepting Federal Direct Loan(s) at ERAU, you must inform the Financial Aid Office of any disbursements you received at another school during the academic year.
Due to the timing of loans, we may not be aware of the total loan amounts you may have received at your other school. Failure to notify our office of any loans you received at another school during the year can result in your existing loans being reduced and billed in order to keep within the annual loan limits. This would result in a balance owed (by you) to ERAU.
To avoid being over-awarded at ERAU, please follow these simple steps:
- Cancel any pending financial aid disbursements at your previous school before transferring.
- Inform us of any Financial Aid received at another Institution in the same Academic Year.
Note: Your previous school may also contact us directly by looking up our contact info on the National Student Loan Data System (NSLDS).
Don’t Over-Borrow
If you inadvertently received federal student loan funds in excess of your borrowing limit, you are ineligible for additional federal student aid unless you repay the excess loan amount in full, or agree to repay the excess loan amount in accordance with the terms of the promissory note that you signed.
Agreeing to repay the excess loan amount in accordance with the terms of the promissory note is called “reaffirmation.” You can reaffirm an excess loan amount by signing a “Reaffirmation Agreement” with your loan servicer.
Then, you must submit documentation of the action taken to the Embry-Riddle Financial Aid Office. Acceptable documentation may include but is not limited to:
- Payment confirmation from your loan servicer that you have paid the excess amount.
- Loan Summary Sheet from Direct Loans confirming you have consolidated all loans that were in excess.
To review your loan amounts and determine your loan holder (loan servicer), log into studentaid.gov/login with your FSA ID.
Resolving a Loan Overage
If you have received loans in excess of the lifetime aggregates, you must choose from the two options listed below in order to resolve the overage:
- Repayment of the excess loan amount by contacting the servicer of the loan indicated on studentaid.gov and following the servicer's instructions. Once the loan has been repaid, you must attach a copy of the repayment confirmation from the servicer to ERAU.
- Request a reaffirmation of loan funds with the servicer of the loan indicated on studentaid.gov. Please contact the servicer and ask for a reaffirmation letter in the amount of your overage. Once you receive your reaffirmation letter, please email to us at prfinaid@erau.edu. Be sure to include your student ID number when submitting.
Federal student loans can be very useful in helping cover education and living expenses, but keep in mind that loans must be repaid. Borrowers need to understand the responsibility that comes with student loan debt because their borrowing decisions will impact their ability to meet future financial obligations. The articles below can help borrowers learn more about responsible borrowing and successful repayment.
Exit Loan Counseling
Review the Exit Loan Counseling Guide.
All students who borrowed Federal Student Loans must complete Exit Loan Counseling online prior to graduation, withdrawing from the university, or dropping their enrollment below half-time.
The purpose of exit counseling is to ensure students understand their student loan obligations and are prepared for repayment
Repayment Guides and Information
Private Loans are provided by a lender such as a bank, credit union, or state agency. It can supplement the amount the government allows you to borrow from their programs.
Things to look for in a private loan:
- Eligibility requirements: Most private loans require a credit-worthy applicant and/or co-signer. Having a co-signer may reduce the cost of the loan.
- Interest rates: Most private loans have variable interest rates. Determine how often the interest rate is adjusted and how it's calculated.
- Fees: Many private loans have fees deducted from, or added to, the amount you borrow. Find out when they're charged and how much.
- Annual Percentage Rate (APR): The APR is the annual cost of your loan, including the effect of any fees and charges in addition to interest. Remember, a loan with fees and a lower base interest rate may be as good of a choice as a loan with no fees and a higher base interest rate. APR helps show how all charges affect the cost of the loan.
- Repayment: Determine the repayment terms, including monthly payments and repayment period. Some lenders offer rewards, such as interest rate reduction, to borrowers who make payments on time or via electronic funds transfer (EFT).
- Loan limits: Check to see if there is an annual or aggregate limit. Try to pick a lender who has an aggregate limit that works best with your program of study. Some private loans have maximum limits, while others allow you to borrow up to your total cost of attending school.
- Compare lenders and apply for private loans.
- Credit Approval: The borrower, and if applicable, the co-signer must pass a credit check. Applying with a qualified co-signer may give you the best rate. The private loan credit approval will be valid for a limited time, most commonly six months, and generally require a new application every year. Please check with your lender for details.
- Credit checks: Both the borrower and co-signer must pass a credit check. Applying with a qualified co-signer may give you the best rate. Private loan credit checks are valid for a limited time. Please check with your lender for details.
- Do not hesitate to contact us at 928-777-3765 or prfinaid@erau.edu with any questions.
Fresh Start is a temporary program from the U.S. Department of Education (ED) that offers special benefits for borrowers with defaulted federal student loans. Fresh Start ends Sept. 30, 2024.
This is not loan forgiveness, meaning your loan debt balance is not being reduced or canceled.
All Fresh Start initiative participants must repay their loans and will have one year after the end of the COVID-19 student loan payment pause to make payment arrangements. Any borrower with eligible defaulted federal student loans can make payment arrangements during the initiative by visiting the ED's Debt Resolution website, contacting their loan holder by phone or in writing, or calling the Default Resolution Group at 1-800-621-3115.
You may regain Federal Student Aid benefits:
- Restores access to repayment options — that could offer monthly payments as low as $0 through IDR plans — and provide opportunities for loan forgiveness.
- Restores eligibility to receive federal student aid, including Federal Pell Grants and campus-based aid like Federal Work-Study, so borrowers can complete their course of study and increase long-term repayment success.
- Protects borrowers from involuntary collection efforts and costly collection fees.
- Restores eligibility for future rehabilitation for borrowers who rehabilitated a defaulted loan during the payment pause.
- Provides credit reporting features — including removing borrowers from the federal Credit Alert Verification Reporting System (CAIVRS) — making it potentially easier and more affordable for student loan borrowers to afford living expenses.
Eligible Loans:
- Defaulted William D. Ford Federal Direct Loan (Direct Loan) Program loans
- Defaulted Federal Family Education Loan (FFEL) Program loans
- Defaulted Perkins Loans held by ED
Loans Not Eligible:
- Defaulted Perkins Loans held by schools
- Defaulted Health Education Assistance Loan Program loans
- Student loans remaining with the U.S. Department of Justice for ongoing litigation
- Direct Loans that default after the end of the pause on student loan payments and collections
If you’re not sure whether your loans qualify, you can call the Default Resolution Group at 1-800-621-3115 (TTY for the deaf or hard of hearing 1-877-825-9923).
Process
Process for students returning to school with a loan default:
- A Free Application for Federal Student Aid is required to notify the institution of your intent to return to school.
- Once we receive your FAFSA, we will review your eligibility for the Fresh Start Initiative based on which loans are in default and when.
- If you qualify, a form will be added to your To-Do List to complete.
- Once the Acknowledgment form is returned, we will review and, if eligible, will proceed in awarding Title IV aid.
Process for parents applying for a Parent PLUS Loan with a default:
- A Parent PLUS Loan application will need to be submitted to notify the institution of your intent to receive Title IV aid.
- Once we receive the PLUS Loan application, we will review the parent's eligibility for the Fresh Start Initiative.
- If eligible, a form will be sent to the parent's email on file. This will include next steps, additional information about Fresh Start and a page that requires a signature. This signature page needs to be returned to our office.
- Once we have received the form, we will review the information again and let the parent know how to proceed.
For more and updated information, please visit the Federal Student Aid website.
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