Federal Direct Student Loans are low interest loans to help students pay for the cost of their education. The lender is the U.S. Department of Education rather than a bank or other financial institution. Direct Loans are a form of financial aid that must be repaid with interest.
A student loan is a serious long-term obligation that should be used only as a last resort. If it is necessary for the student to apply for a student loan, they must complete all required steps for processing of the Direct Loan. They must also be enrolled in at least 6 credits to receive a loan.
Types of Direct Loans
- Subsidized Direct Loan
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For students who demonstrate financial need, which is determined by federal regulations. Students will always be awarded subsidized loan funds first whenever possible.
These loans do not accrue interest while the student is in school as at least a half-time student (6 units or more), during their grace period, and during their deferment periods. Interest begins to accrue once they enter repayment.
Time Limit for Direct Subsidized Loan Eligibility for First-Time Borrowers
There is a limit on the maximum period of time (measured in academic years) that a student can receive Direct Subsidized Loans. In general, students may not receive Direct Subsidized Loans for more than 150% of the published length of their program.
- Unsubsidized Direct Loan
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This type of direct loan is not based on financial need.
The interest begins to accrue after the student's first disbursement. Interest accrues during all time periods including the time the student is in school, grace periods, and deferment periods.
Interest can be paid while the student is in school, or it can be deferred until the student enters repayment. Capitalization occurs if the student defers the interest which is when the unpaid interest that accrues is added to the loan amount the student borrowed.
Note: Students will always be awarded subsidized loan funds first whenever possible.
Learn More About Federal Direct Loans
Loan Amounts
The Direct Loan amount the student requests may not be the amount they are eligible to receive and may be awarded less than the annual or quarterly maximum amount listed. Peninsula College determines their amount of eligibility based on the grade level at the time of certification provided by Enrollment Services. We also determine the maximum amount of eligibility based on other factors such as the student’s current cost of attendance budget and financial aid awards.
- Understanding Your Grade Level
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Your grade level is determined by the number of COMPLETED credits toward the degree or certificate you are CURRENTLY enrolled in. Developmental coursework (below 100 level math, English, or human development classes) does not count for this, as those courses do not directly apply towards your degree completion.
Check how many credits you have completed towards your degree or certificate by checking your Academic Advisement report through the Academic Progress tile in your ctcLink student account.
- 1st Year Student
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Dependent Student Independent Student Maximum Annual
Subsidized$3,500.00
$3,500.00
Maximum Annual
Unsubsidized$2,000.00
$6,500.00
Maximum Total
Annual Combined$5,500.00
$9,500.00
Maximum Total
Quarterly Combined$1,834.00
$3,167.00
Note: Students will always be awarded subsidized loan funds first whenever possible.
- 2nd Year Student
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Dependent Student Independent Student Maximum Annual
Subsidized$4,500.00
$4,500.00
Maximum Annual
Unsubsidized$2,000.00
$6,500.00
Maximum Total
Annual Combined$6,500.00
$10,500.00
Maximum Total
Quarterly Combined$2,167.00
$3,500.00
Note: Students will always be awarded subsidized loan funds first whenever possible.
- 3rd/4th Year Students (BAS Students Only)
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Dependent Student Independent Student Maximum Annual
Subsidized$5,500.00
$5,500.00
Maximum Annual
Unsubsidized$2,000.00
$7,000.00
Maximum Total
Annual Combined$7,500.00
$12,500.00
Maximum Total
Quarterly Combined$2,500.00
$4,167.00
Note: Students will always be awarded subsidized loan funds first whenever possible.
- Origination Fee
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The Department of Education charges a loan origination fee. This fee is deducted before your funds are disbursed, so the loan amount you receive will be the amount you requested minus the loan fee. The origination fee is 1.057% of the borrowed amount.
- Loan Interest Rates for 2025-2026
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Direct Loans for Undergraduate Students: 6.39%
Parent PLUS Loans: 8.94%
Apply for a Student Loan
Ready to apply for a Direct Loan? First, you need to complete the FAFSA. If we have not received and reviewed your 2025-26 FAFSA, then you are not eligible to apply for a loan at this time. You will be notified via email to check your ctcLink Financial Aid account when your file is reviewed.
- Eligibility Requirements
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Completed and reviewed Financial Aid file with the Peninsula College Office of Financial Aid
- Completed the FAFSA for the current aid year
- Submitted all required documentation as requested
- Notified that your financial aid file has been reviewed
Enrolled in a financial aid eligible degree or certificate program
Enrolled in at least six credits each quarter you wish to receive a loan
Maintain Financial Aid Satisfactory Academic Progress (SAP)
- Step 1: Complete the Student Loan Entrance Counseling
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Entrance counseling ensures you understand the terms and conditions of your loan and your rights and responsibilities. You'll learn what a loan is, how interest works, your options for repayment, and how to avoid delinquency and default.
You will need your FSA ID from the Department of Education (the same username and password you use to sign your FAFSA) to sign into the site.
- Step 2: Complete the Master Promissory Note (MPN)
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The Master Promissory Note (MPN) is a legal document in which you promise to repay your loan(s) and any accrued interest and fees to the U.S. Department of Education. It also explains the terms and conditions of your loan(s).
You will need your FSA ID from the Department of Education (the same username and password you use to sign your FAFSA) to sign into the site.
Important Note: Missing or incomplete information on the MPN will cause delays with your loan disbursement. Common missing or incomplete items are driver's license number and references' contact information. To avoid delays, please have all required information at hand before submitting your MPN.
- Step 3: Complete and Submit the Loan Request Worksheet
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Once the Office of Financial Aid has received your loan request worksheet and confirmation from the Department of Education that you completed the Entrance Counseling and MPN, we will award you a loan.
Submission Methods:
Mail: ATTN: Office of Financial Aid, 1502 East Lauridsen Boulevard, Port Angeles, WA, 98362
Fax: 360-417-6395
In Person: 1502 East Lauridsen Boulevard, Port Angeles, WA, 98362
- Loan Request Processing Time
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For students who do not complete the loan request process (including the Entrance Counseling and MPN) at least 10 days prior to the start of the quarter, loan funds will be delayed approximately 10-15 days from the date that all of the above instructions have been followed. Delays in completing the online Entrance Counseling and MPN will result in delays in receiving your funds.
Please be advised that loans cannot be authorized after the loan period is over. Typically, the loan period ends on the last day of the last quarter of ½- time enrollment (6 or more credits).
We are not able to process last-minute requests for loan funds, due to processing times, therefore it is very important you complete your MPN and Entrance Counseling at least ONE WEEK prior to the end of the loan period.
Loan Disbursements
Your loan will be awarded in multiple disbursements. If we are disbursing after the quarter has started, it may take up to 7 days from the date you are awarded to the date your funds are disbursed.
- Single Quarter Only Loans
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The loan will be disbursed twice in the quarter. The first disbursement will be scheduled at the beginning of the quarter and the second disbursement will be scheduled at the mid-point of the quarter.
- Multiple Quarter Loans
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The loan will be equally awarded among all quarters for which you are eligible and will be disbursed once in each quarter.
- Important Notice for First-Time Borrowers at Peninsula College
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Students who have completed less than 15 credits at Peninsula College and have not received a prior Subsidized or Unsubsidized Direct Loan while attending Peninsula College are considered a first-time borrower. There is a 30-day “waiting period” before the first disbursement of loan funds for first-time borrowers and will receive their loan funds after the 30th calendar day of the quarter.
- Student Loan Right to Cancel
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You have the right to cancel your student loan at any time. If your loan funds have already been disbursed to you, you have 14 business days to return the funds to the college for a full refund back to the loan program. If you have already received your loan disbursement and it has been more than 14 days, you can send the funds directly to the Department of Education.
Any loan funds not needed to pay the student's tuition and fees will be disbursed to them in the form of a financial aid refund. All students will receive their awarded financial aid funds based on their selected refund preference with BankMobile Disbursements, a technology solution, powered by BMTX, Inc.
Loans cannot be used to set up bookstore accounts to directly pay for books and other course materials. Only if the ebook/course materials fee is added to the student's charges/fees on their student account for the term, then the charge can be covered by the student's loan funds.
Students are REQUIRED to be enrolled and attending at least half-time (6 or more credits) in order to be eligible for a loan. Loans for students who drop below half-time attendance at any time may be subject to cancellation; the student may be required to repay 100% of the loan proceeds they received if they do not attend at least half-time.
Graduating, Withdrawing, or Dropping Below Half-Time
- Required - Student Loan Exit Counseling
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The student is required to complete Student Loan Exit Counseling immediately after they graduate, withdraw, or drop below half-time.
- Student Loan Repayment
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Repayment of student loans will begin six months after the student graduates, withdraws, or drops below half-time. Avoid defaulting on student loans at all costs. If you run into financial problems with your repayment schedule, contact the Direct Loan Servicing Center at 1-800-848-0979. There may be solutions that can keep you on track and protect your credit rating.
- Understand Student Loan Repayment with Solutions at ECMC
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Peninsula College has teamed up with Solutions at Educational Credit Management Corporation (ECMC) to be a buffer between student loan borrowers and their loan servicer and to answer all of their student loan repayment questions.
Solutions is a service of the non-profit organization ECMC and helps students understand the complexities of student loan repayment. Students with questions about federal student loan repayment are encouraged to take advantage of these free services. Their resources are available to you free of charge.
To contact a Solutions Student Loan Repayment Advisor, email or web chat, or call them at 1-877-331-3262.
Schedule an appointment to speak to a student counselor during a time that works for you!
Cohort Default Rate (CDR)
The Cohort Default Rate (CDR) for federal student loans is a metric used to measure the percentage of borrowers from a specific cohort who defaulted on their federal student loans within a three-year period after entering repayment. A high CDR negatively impacts a school's ability to offer federal grants and loans to students.
- Cohort Default Rate - Peninsula College
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FY2022 Cohort Default Rate: 0.0%
FY2021 Cohort Default Rate: 0.0%
FY2020 Cohort Default Rate: 0.6%
FY2019 Cohort Default Rate: 3.9%
FY2018 Cohort Default Rate: 12.6%