The Graduate Federal Direct Unsubsidized Loan is a low-interest loan available to U.S. Citizens or U.S. Permanent Residents for post-secondary educational expenses. The loan is made to the student who is responsible for repayment. You are eligible to participate in the Federal Direct Loan Program if you are: (1) a U.S. Citizen or U.S. Permanent Resident; (2) enrolled in a degree program on at least a half-time basis and credits count towards the degree; and (3) making Satisfactory Academic Progress (SAP). International students cannot apply. International students have other private loan options, which can be found by visiting Credit-Based Loans Available to International Students.

The interest rate for a Graduate Federal Direct Unsubsidized Loan disbursed on or after July 1, 2024 and before July 1, 2025 is 8.08%. The loan fee for a Graduate Federal Direct Unsubsidized Loan that have their first disbursement on or after October 1, 2020 and before October 1, 2025 is 1.057%. The U.S. Department of Education will not pay interest while a student is in school, and the student is responsible for paying the interest on a Direct Unsubsidized Loan during all periods. Interest accrues as soon as the loan is disbursed, and must be paid or capitalized, during periods of in-school enrollment and/or deferment.


How much can I borrow?

Graduate and professional students may be eligible to borrow up to $20,500 per FAFSA year (July 1 to June 30) in a Federal Direct Unsubsidized Loan. The actual amount is based on the Cost of Attendance (which includes the cost of tuition, mandatory fees, living expenses, and BU medical insurance) minus aid received (notably non-service fellowships such as the Dean’s Fellowship, as well as tuition and insurance scholarships). The cumulative maximum for the Federal Direct Subsidized and Unsubsidized Loan Program (formerly called the Stafford Loan Program) is $23,000 for undergraduates, and $138,500 for graduate and professional students, including any amount borrowed for undergraduate study.


How do I apply?

  1. Complete a Free Application for Federal Student Aid (FAFSA). Boston University’s Title IV school code is 002130.
  2. Complete a Graduate Student Master Promissory Note (MPN) if you are a first-time borrower or if you have not borrowed a Federal Direct Loan within the last five years.
  3. Complete the Graduate Student Entrance Counseling if you are a first-time borrower. Federal regulations require you to complete Entrance Counseling before your loan funds can be credited to your student account. 
  4. Submit a loan request for the appropriate period:

Since the Master Promissory Note (MPN) does not list loan amounts, the Graduate School will send all students a loan approval letter, which lists the approved loan amounts. This notification will be mailed to students once the FAFSA and Loan Request Form are complete. Students can also check on the status of loan funds by accessing the MyBU Student Portal.


When will the loan funds be available to me?

Once the loan servicer has approved your loan, the loan amount minus an origination fee will be electronically credited to your student account within five to ten business days.  The loan fee for a Federal Direct Unsubsidized Loan that have their first disbursement on or after October 1, 2020 and before October 1, 2025 is 1.057%. This fee is determined by the U.S. Department of Education.  Funds cannot be disbursed until the Entrance Counseling requirement has been fulfilled, until you have signed a Master Promissory Note, and until you are registered for the semester.

Federal legislation requires that all Federal Direct Loans be disbursed in two equal installments. The second disbursement cannot be made available until halfway through the loan period. This means that for students who are attending both semesters of the academic year, half the loan amount is available in the fall and the other half is available in the spring. For students borrowing for one semester only (January graduates or students beginning their studies in January), the loan is disbursed in one lump sum. You can request an electronic refund by submitting a Graduate Student Refund Request Form.