Federal Direct Loan Program
These federally guaranteed Student Loans are available to students who apply for financial aid by completing the Free Application for Federal Student Aid (FAFSA). The University of Maine at Presque Isle is a direct lending institution with loans available through the William D. Ford Federal Direct Loan Program. A student may be eligible for a Federal Subsidized or Unsubsidized Loan. The “subsidized” loan is need-based and the government pays the interest on the loan while the student is in school or in deferment. The “unsubsidized” loan in non-need based and the student is responsible for the interest while in school and during deferment periods. All Direct Loan borrowers are charged a minimal loan service fee determined by the Department of Education.
Students are notified of their Loan eligibility through their award letters generated by the Student Financial Services Office.
Annual Loan Limits
Federal regulations specify the maximum Federal Loan amount any student can borrow each academic year, depending upon grade level. Actual eligibility is specified on the University of Maine Award Notification and may be less than the annual maximum:
Effective July 1, 2008
| Grade Level and Dependency | Credit Hours Earned | Maximum Subsidized Loan | Maximum Loans (subsidized and unsubsidized) |
|---|---|---|---|
| Dependent first-year | less than 24 | $3,500 | $5,500 |
| Dependent sophomore | 24 -53 | $4,500 | $6,500 |
| Dependent junior or senior | 54 and above | $5,500 | $7,500 |
| Independent first-year | less than 24 | $3,500 | $9,500 |
| Independent sophomore | 24-53 | $4,500 | $10,500 |
| Independent junior or senior | 54 and above | $5,500 | $12,500 |
NOTE: Dependent students whose parents are denied a Federal PLUS Loan are eligible for the independent student limits if there is a valid PLUS Loan denial (dated within the last year) on file in the Student Financial Services office.
In order to have the initial loan disbursement, students are required to complete a loan entrance counseling session. In addition, the students must complete the Master Promissory Note. Loans will automatically be disbursed in subsequent semesters. Before leaving school, students must complete a loan exit counseling session. Information on all of these items can be found at http://www.studentaid.gov.
Loan Borrowing and Cohort Default Rate
68.48% of University of Maine at Presque Isle undergraduates borrowed federal loans during the 2024 academic year (September 2023 – August 2024).
The average Federal loan indebtedness for University of Maine at Presque Isle undergraduates at spring graduation in 2024 was $10,398.
The Typical Monthly Loan Payment is $111 per month. (Median monthly loan payment for student borrowers who completed, if it were repaid over 10 years at a 5.05% interest rate. The total lifetime costs of this amount of student loans would be $13,265 paid over 10 years.)
The U.S. Department of Education (Dept) tracks the number and percentage of federal student loan borrowers who default on their student loans within three years of entering repayment. This is the Cohort Default Rate, commonly referred to as “three-year” CDRs.
The Department of Education releases official cohort default rates for each school that is eligible to participate in the federal student loan program once per year. The current rates (FY 2021) were released in September 2024 and the FY 2022 rates should be released in September 2025. The national cohort default rate average and UMPI’s cohort default rate is currently 0% due to the moratorium on student loan payments and interest charges that was in effect until August 31, 2023.
The FY 2021 Cohort Default Rate is 0%. A cohort default rate is the percentage of a school’s borrowers who enter repayment on certain Federal Family Education Loan (FFEL) Program or William D. Ford Federal Direct Loan (Direct Loan) Program loans during a particular federal fiscal year (FY), October 1 to September 30, and default or meet other specified conditions prior to the end of the second following fiscal year.
Federal Direct PLUS Loans
Federal PLUS Loans enable parents with good credit histories to borrow for the educational expenses of each child who is a dependent undergraduate student enrolled at least half-time. The variable interest rate is adjusted each year but will never exceed 9%.
The yearly limit on the PLUS Loan is equal to the student’s cost of attendance minus any other financial aid received. Parents pay a small origination fee, deducted proportionately each time a loan payment is made. There is no grace period for these loans; interest begins to accumulate at the time the first disbursement is made. Generally, parents must begin repaying both principal and interest 60 days after the date of the final loan disbursement.
Alternative Loans
For information regarding other loans available to meet your remaining financial need, please contact the Student Financial Services Office.