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Maximum Eligibility Period for Federal Direct Subsidized Loans

Federal Student Aid Helpful Articles

Is there a time limit on how long I can receive loans?

Maximum Eligibility Period = 150% of Your Current Program

If you are a first-time borrower as of July 1, 2013 there is a limit on the maximum period of time (measured in academic years) that you can receive Subsidized Federal Direct Loans.

In general, you may not receive Subsidized Federal Direct Loans for more than 150% of the published length of your program. This is called your "maximum eligibility period".

For example, if you are enrolled in a two-year program: 150% of 2 years = 3 years (2 x 1.5)

See your program to find the published length of your program.

I Borrowed Federal Loans in the Past, Does this Policy Affect Me?

If your previous federal loans were paid off as of July 1, 2013 and you are now borrowing again, you are considered a first-time borrower and this policy applies to you.

What Happens If I Exceed the 150% Maximum Eligibility Period?

If you do not complete your program before you've reached 150% of your program length you will:

  1. Not be eligible for new Subsidized Loans.

  2. Lose the subsidy for past Subsidized Loans. In other words, the government will no longer pay the interest on any of your loans while you are in school. All your loans, both past and present, will be accumulating interest.

What if I Change Programs or Transfer to Another College or University?

Changing your program or transferring schools does not reset your maximum eligibility period. Loans borrowed for the previous program will count against your maximum eligibility period for your current program.

How Do I Calculate My Remaining Subsidized Loan Eligibility?

  1. Calculate the maximum eligibility period for your current program.
    • current program length x 1.5
  2. Calculate your previous usage. Don't forget to include usage for previous programs at Hawkeye and other schools.

  3. Calculate the difference between your current program maximum eligibility period and your previous usage.
    • If your current program's maximum eligibility period is larger than what you've previously used, the remainder is what you are still eligible for.

    • If your current program's maximum eligibility period is less than what you've previously used, you are no longer eligible for subsidized loans.

Example Scenarios

Student Enrolls in a: 4-year program 4-year program 4-year program 2-year program 2-year program
Students Maximum Eligibility Period for this program is: 6 years 6 years 6 years 3 years 3 years
Student uses: 5 years of eligibility 5 years of eligibility 1 year of eligibility 3 years of eligibility 3 years of eligibility
Student completes or graduates from the program? Yes No No No Yes
Student decides to enroll in a new program. The new program length is: 2 years 2 years 2 years 2 years 2 years
Maximum Eligibility Period for the new program is: 3 years 3 years 3 years 3 years 3 years
Does the student have any eligibility remaining for additional Subsidized Loans? No, the student has already exceeded the maximum eligibility period for this program with their 4-year program. No, the student has already exceeded the maximum eligibility period for this program with their 4-year program. Yes, the student has two years of eligibility remaining. No, the student has already met the maximum eligibility period for this program with their previous 2-year program. No, the student has already met the maximum eligibility period for this program with their previous 2-year program.
Did the student lose the subsidy on their previous Subsidized Loans? No, the student completed their 4-year program. Yes, the student did not complete their previous program and has already exceeded the maximum eligibility period for the new program. No, the student has two years of eligibility remaining. Yes, the student did not complete their previous program and has reached the maximum eligibility period for the new program. No, the student completed their previous 2-year program.

What will the US Department of Education be responsible for?

The US Department of Education will be responsible for:

  • Determining whether a loan applicant is a new borrower for subsidy limit purposes;
  • Tracking borrowers’ subsidized loan borrowing in greater detail;
  • Informing schools of the number of periods a borrower has received subsidized loans;
  • Informing borrowers when they exceed the eligibility limit and become responsible for accruing interest.

For More Information

For more information, sign in to Manage My Direct Loan to refer to your Entrance Loan Counseling.

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