Federal loans are government-backed financial aid options available to graduate and professional students, providing favorable terms and repayment flexibility. The Federal Direct Unsubsidized Loan is a common federal student loan program available to graduate students. It is not based on financial need, and interest accrues from the moment the loan is disbursed. Federal student loans are made through the William D. Ford Federal Direct Loan Program. Eligible students borrow directly from the U.S. Department of Education and the University of Iowa administers the loan.
How to Apply
- Complete the Free Application for Federal Student Aid (FAFSA).
- First-time borrowers must complete Entrance Counseling and a Master Promissory Note (MPN) for Graduate/Professional students.
- Accept, reduce, or decline your Federal Direct Loan(s) for each semester in MyUI before the end of the semester the loan was offered for.
- Plan ahead for loan processing: Federal regulations determine when our office can process a Federal Direct Loan. If you plan to use a loan at the start of a semester, complete all required steps at least one month before the semester begins to avoid delays.
Federal Direct Unsubsidized Loan
- Available to graduate, and select health professional students who have half-time enrollment
- Not based on financial need
- Interest begins to accrue when the loan is disbursed and will accrue through the life of the loan
- Interest payments are not required while a student is in school, but it will reduce the total repayment amount
- We encourage all students to borrow this loan before borrowing PLUS or private student loans
How Loan Amounts Are Determined
Your federal student loan amount is not one fixed number. It is based on a few key factors that can change from year to year.
What Impacts Your Loan Amount
Your eligibility is based on:
- Your enrollment: You must be enrolled at least half-time to receive a federal Direct Loan. Beginning with the 2026–27 academic year, if you are enrolled less than full-time, your annual federal Direct Loan limit will be reduced based on your enrollment intensity. Learn how your enrollment affects your federal student loans.
- Other financial aid you are receiving: Your total aid, including scholarships and grants, cannot exceed your cost of attendance.
Loan Limits, beginning 2026-27
Note: Federal loan limits assume full-time enrollment. If you enroll less than full-time, your annual loan eligibility will be reduced proportionally based on the number of credits you take.
Graduate Students
Master’s and Ph.D. programs
| Limit | Amount |
|---|---|
| Annual Limit | $20,500 |
| Aggregate Limit | $100,000 |
Professional Students
Medicine, Dentistry, Law, Pharmacy, Psy.D. or Ph.D., and other defined professional programs
| Limit | Amount |
|---|---|
| Annual Limit | $50,000 |
| Aggregate Limit | $200,000 |
Please Note:
- These limits do not include amounts borrowed as an undergraduate.
- Students who are both graduate and professional students at different points in their education may borrow a combined maximum of $200,000 for graduate and professional study.
Legacy Loan Limits
To keep legacy status for the Federal Direct Unsubsidized Loan, a graduate or professional student must have received a federal Direct Loan disbursement before July 1, 2026, and remain continuously enrolled in the same credentialed program of study at the same institution.
Graduate Students
Master’s and Ph.D. programs
| Limit | Amount |
|---|---|
| Annual Legacy Limit | $20,500 |
| Aggregate Legacy Limit | $138,500 |
Professional Students
Medicine, Dentistry, Law, Pharmacy, Psy.D. or Ph.D., and other defined professional programs
| Limit | Amount |
|---|---|
| Annual Legacy Limit | $50,000 |
| Aggregate Legacy Limit | $224,000 |
Please Note:
- These limits include amounts borrowed as an undergraduate.
Legacy Loan Limits for Select Health Professions
Students in Medicine and Dentistry, Pharmacy, Masters in Public Health, Doctoral in Clinical Psychology, and Masters or Doctoral in Health Administration can receive the additional Unsubsidized Loan for Select Health Professions if they have received a federal Direct Loan disbursement before July 1, 2026, and remain continuously enrolled in the same credentialed program of study at the same institution. The amount they can receive is based on the number of months enrolled.
| Program | Number of Months | Amount |
|---|---|---|
| Pharmacy, MPH, MHA, Ph.D. Clinical Psychology | 9 months | $12,500 |
| Pharmacy, MPH, MHA, Ph.D. Clinical Psychology | 10 months | $13,889 |
| Pharmacy, MPH, MHA, Ph.D. Clinical Psychology | 11 months | $15,278 |
| Pharmacy, MPH, MHA, Ph.D. Clinical Psychology | 12 months | $16,667 |
| Med, Dent | 9 months | $20,000 |
| Med, Dent | 10 months | $22,222 |
| Med, Dent | 11 months | $24,444 |
| Med, Dent | 12 months | $26,667 |
8.07 %
For loans first disbursed
between 7/1/2026 - 6/30/2027
1.057 %
For loans first disbursed
between 10/1/2020 - 9/30/2027
Interest is additional money that you pay to a lender as a cost of borrowing money. Interest is calculated as a percentage of the unpaid principal amount that you borrowed.
Direct Loans are “daily interest” loans. On daily interest loans, interest accrues (adds up) every day.
An origination fee is a percentage of your loan amount charged by the lender for the processing of your loan.
Federal loans have an origination fee; therefore, the amount you may receive as a disbursement may be slightly lower than the amount you accept.