MBA Finances
Federal Loan Options
The University of California, Berkeley participates in the William D. Ford Federal Direct Loan Program, which allows full-time and part-time students to borrow money directly from the federal government at a fixed interest rate (6.8% for Subsidized and Unsubsidized Loans; 7.9% for the Grad PLUS Loan).
Federal Direct Subsidized, Unsubsidized and Grad PLUS loans are not processed through a bank; therefore, bank loan applications are not required. A Free Application for Federal Student Aid (FAFSA) must be filed each year that a student intends to borrow a loan. The loans must be paid back beginning six m onths after graduation or dropping below half-time attendance. The standard repayment term for the loans is 10 years.
Federal Direct Subsidized Student Loans are need-based loans. The federal government pays the interest that accrues on the loan while the student is enrolled at least half-time (6 units at Haas) and during the six-month grace period. Students can receive a maximum of $8,500 in a Subsidized Loan each year.
How to apply for the Direct Subsidized Loan
Federal Direct Unsubsidized Student Loans are non-need based loans. All students who meet general eligibility requirements may qualify for Federal Direct Unsubsidized Loans. The student is responsible for all interest that accrues while the student is enrolled at least half-time. Interest begins to accumulate from the date of the first loan disbursement and is billed quartely. The interest that accrues is not compounded or capitalized during periods of enrollment; the accrued interest is only capitalized once, prior to repayment. Effective July 1st, 2007, students will typically receive up to $12,500 in an Unsubsidized Loan each year, however a student could receive up to $20,500 depending on her/his eligibility for the Subsidized Loan (each year, a student can only receive up to $20,500 in a combined total of Subsidized and Unsubsidized loans).
How to apply for the Direct Unsubsidized Loan
Federal Direct Grad PLUS Loans are non-need based loans. Grad PLUS Loans are credit-based loans which require a credit check. To be eligible for a Grad PLUS loan you must meet the other general eligibility requirements for the Federal Student Aid Programs, and must not have an adverse credit history (i.e., currently no more than 90 days late on any debt and no bankruptcies or tax liens within the past 5 years; no defaults or adverse actions on any prior education debt). Students can borrow a Grad PLUS Loan up to the remaining total cost of education each year, minus any other expected financial aid.
How to apply for the Grad PLUS Loan
