All Federal Direct Loans are assessed a loan fee by the federal government. This fee helps reduce the cost of making these low-interest loans. The federal government will deduct the fee from the loan before the borrower receives any loan money; therefore, the loan funds received by the borrower will be less than the amount they borrow and repay.

On the financial aid offer, in the cost for the academic year section, there is a Loan Fees category. These are federal loan fees that are not charged or billed to you by the University of Iowa. If you choose to accept the loans offered, the loan fees will be deducted from your federal loan proceeds.

Examples:

  • A student borrows a $3,500 Federal Direct Subsidized Stafford Loan for the 2021-2022 academic year and funds are disbursed before October 1, 2021. Subtract the 1.057% loan fee ($37) from $3,500. The net amount of loan funds the student will receive is $3,463.
  • A parent borrows a $10,000 Federal PLUS Loan for the 2021-2022 academic year and funds are disbursed after October 1, 2021. Subtract the 4.228% loan fee ($423) from $10,000. The net amount of loan funds the parent will receive is $9,577.

The Federal Direct Loan Servicer will mail, to the borrower, a disclosure statement indicating the exact loan terms.

Federal Direct Loan Fees

Stafford Loan:

  • 1.057% for loans disbursed October 1, 2021 - September 30, 2022
  • 1.057% for loans disbursed October 1, 2020 - September 30, 2021
  • 1.059% for loans disbursed October 1, 2019 - September 30, 2020
  • 1.062% for loans disbursed October 1, 2018 - September 30, 2019
  • 1.066% for loans disbursed October 1, 2017 - September 30, 2018

PLUS Loan:

  • 4.228% for loans disbursed October 1, 2021 - September 30, 2022
  • 4.228% for loans disbursed October 1, 2020 - September 30, 2021
  • 4.236% for loans disbursed October 1, 2019 - September 30, 2020
  • 4.248% for loans disbursed October 1, 2018 - September 30, 2019
  • 4.264% for loans disbursed October 1, 2017 - September 30, 2018