Student using laptop at homeIf you’re like many students attending college, you may need to borrow Federal Direct Student Loans to cover a portion of your college costs. The financial aid office will include these loans on your financial aid award when you submit the FAFSA. If you’re new to student loans (or need a refresher), read below for some useful information regarding various aspects of these Federal Direct Student Loans.

Fact 1: Before borrowing a Direct Student Loan, you must complete a process called Entrance Counseling. Think of entrance counseling as a high-level overview of the loan you’re about to borrow. Some institutions will require you to complete entrance counseling in person. Others (the majority) will require you to complete entrance counseling online. The one-time process takes 20–30-minutes and can be completed online at Only the student (and not the parent) may complete entrance counseling.

Fact 2: The Master Promissory Note (MPN) is a legal document that must be signed by the loan borrower and that promises he or she will repay the loan plus interest to the loan holder. Once you’ve completed entrance counseling and have a better understanding of all aspects of the direct loan, the MPN is that legal document that says “yes, I understand what I am borrowing and agree to pay back the loan (+ interest)”. Similar to entrance counseling, you can meet your MPN requirement online.

Fact 3: The student, and only the student, is the sole borrower on Direct Student Loans. Unlike other student loans that may have multiple borrowers tied to the loan, students are the only borrower on Direct Student Loans. Since many students don’t have an established credit history, there are no credit checks required before being approved for a Direct Student Loan.

Fact 4: Direct Student Loans have origination fees and both annual and lifetime amounts. Fees change each year. You can find the most current fee here. The fee is deducted directly from the loan amount before the loan funds are provided to the student. For most dependent (dependency is determined by the FAFSA), undergraduate students, the maximum amount you can borrow is $5,500 for freshman year, $6,500 for sophomore year, and $7,500 for both junior and senior year. For most dependent students, the maximum amount you can borrow in Direct Student Loans as an undergraduate is $31,000.

Fact 5: Upon graduating or leaving school, you have multiple repayment options for your Direct Student Loans. That’s good news. Each repayment plan offers a unique set of features and benefits, and depending on your personal situation, one plan might “fit” your lifestyle better. How do you pick the correct one? We suggest reading more about Direct Student Loan repayment plans and using the Repayment Estimator offered through the Department of Education.

So there you have it. Five helpful facts about Federal Direct Student Loans. As always, don’t hesitate to contact us if you have any questions. We can be reached at and (800) 449-MEFA (6332).