Types of Aid: Loans

Federal loans, except the Federal Direct PLUS (Parent) Loans, are available to students through the FAFSA.

Federal Direct Loans are either subsidized or unsubsidized. With a subsidized loan, the Federal Government pays interest on the loan until you begin repayment and during authorized periods of deferment. If you receive an unsubsidized loan, you will be charged interest from the time the loan is disbursed until it is repaid in full.

 Interest Rates for Direct Loans 2023-2024
Direct Subsidized and Unsubsidized Loans for Undergraduate Students 5.50%
Direct Unsubsidized Loans for Graduate Students 7.05%

The undergraduate borrower must also pay a loan fee of approximately 1% of the amount borrowed, while graduate students will pay 4.228%, which is deducted from each disbursement. Repayment begins after you graduate, leave school, or drop below half-time enrollment. You have six months before payments begin. This is called a "grace period". 

 Federal Direct Loan Limits
Grade Level Dependent Undergraduates Loan Limits Independent Undergraduates Loan Limits
Freshman $3500 Sub + $2000 Unsub =
$5500 per annum
$3500 Sub + $6000 Unsub =
$9500 per annum
Sophomore $4500 Sub + $2000 Unsub =
$6500 per annum
$4500 Sub + $6000 Unsub =
$10500 per annum
Junior or
$5500 Sub + $2000 Unsub =
$7500 per annum
$5500 Sub + $7000 Unsub =
$12500 per annum
Aggregate Dependent
Undergraduate Loan 
$23,000 Sub + 
$8,000 Unsub =
Aggregate Independent
Undergraduate Loan 
$23,000 Sub + 
$34,500 Unsub = 
Graduate and Professional Students: $20,500 Unsub = $20,500 per annum
Aggregate Graduate and Professional Loan Limits: $138,500 Unsub

If you accept any loans you must to log into www.studentaid.gov:

Upon graduation or dropping below half-time enrollment, you must complete Exit Counseling by logging into www.studentaid.gov.For more information about Exit Counseling, please see the MSUN exit counseling webpage

At Montana State University-Northern, we encourage students and families to make informed decisions about financial aid. We highly recommend that you borrow only the amount of loans you need to successfully complete your education.

Federal Direct Parent PLUS Loans are loans parents may apply for on behalf of their student. PLUS loans are funded by the Department of Education and is offered automatically in the student aid package after having completed the Free Application for Federal Student Aid (FAFSA). Loans can be made to degree seeking students attending at least half-time (six credits).

What else do you need to know?

  • To be eligible to apply for the Parent PLUS loan, you must be the student's natural or adoptive parent. A stepparent is eligible to borrow the PLUS loan, if his/her income & assets are reported on the FAFSA.
  • Loans are made to credit worthy borrowers; no adverse credit history.
    • Loans denied based on adverse history can still be made by appeal or securing an endorser.
    • For additional information about the process of using an endorser, the parent should contact the Direct Loan Servicer at 1-800-557-7394.
    • More information can be found by reviewing the PLUS Loan Basics.
  • The Department of Education will notify you automatically about approval or denial of your loan.
  • Students can receive an additional amount of unsubsidized loan when the PLUS loan is denied due to the adverse credit history. Freshman and Sophomores can received up to additional $4,000 while juniors and seniors can get up to additional $5,000.
  • Interest accrues on the loan while the student is in school. Begins on the date the loan first disburses and until it is paid in full.
  • Repayment begins 60 days after the PLUS loan is fully disbursed. The repayment term will be 10-25 years depending upon the type of repayment plan selected. There is no grace period for this loan.
    • Parents have the option to defer payments for PLUS Loans, provided the designated student is enrolled at least half-time (six credits) each semester. The parent should check the deferment box on their electronic loan application when submitting their application through Studentaid.gov to be eligible for the deferment.

Interest Rate and Fees:

 Interest Rates for Direct Loans 2023-2024
Direct PLUS Loans for Parents of Dependent Undergraduate Students 8.05%

Parent borrowers must also pay a loan fee of approximately 4.228% of the amount borrowed. 

Applying for Parent PLUS Loan
To apply for a Parent PLUS loan go to Studentaid.gov, use your (parent's) FSA ID to sign in and then click on the Request PLUS Loan link. PLUS borrowers must also complete a Parent PLUS Master Promissory Note (MPN). Additional information about the Parent PLUS Loan can be found here.

Parent PLUS Loan Instructions

Applications for the Federal Direct Parent PLUS loan requires TWO (2) important steps. Please go to Studentaid.gov and sign in using your FSA ID and Social Security Number.


After you have signed in please select:

  1. APPLY FOR A PARENT PLUS LOAN. Be aware that loan amounts are a yearly amount and will be split equally between the fall and spring semesters unless otherwise requested. Disbursements will be applied to your student's university account, and any funds that are in excess of the balance due will be refunded to either you or your student, according to what you indicate on the application. This step must be done every year.
  2. COMPLETE MASTER PROMISSORY NOTE (MPN). You will automatically be directed to complete this step after applying for the PLUS loan. If you need assistance completing the MPN, call the Direct Loan Origination Center at 1-800-557-7394.

What's Next?

  • I want to reduce or cancel my loan.
    • Contact the Financial Aid Office in writing, by mail or via email to finaid@msun.edu. All or a portion of your loan may be canceled up to 14 days after the loan is disbursed. Canceling or reducing the PLUS loan does not make the student eligible for additional Unsubsidized loan. These funds are returned directly to the Department of Education. Because loan fees have been assessed, the exchange is not dollar for dollar and it is possible that a charge for the returned funds appear on the student account. If a refund was generated prior to the loan reduction, the refund may need to be returned.
  • What happens if additional financial aid is received by MSUN.
    • Often, additional financial aid comes into the office after loans have been processed. When this occurs, the Financial Aid Office may reduce loans to make room for the additional funds. PLUS loans are reduced before student loans. These funds are returned directly to the Department of Education. Because loan fees have been assessed, the exchange is not dollar for dollar and it is possible that a charge for the returned funds appear on the student account. If a refund was generated prior to the loan reduction, the refund may need to be returned.
  • What if more PLUS loan funds are needed?
    • If you have not borrowed the fully awarded amount previously, you can submit a written request to the Financial Aid Office indicating how much more of the initial awarded amount you would like.
    • If you have previously borrowed the full awarded amount, contact the Financial Aid Office and discuss your options.


The Office of Financial Aid reserves the right to review a student's situation, including overall student loan debt, and to limit or refuse certification of future federal student loans as determined appropriate on a case-by-case basis. For more detail on refusing or reducing loans, see 34 CFR 685.301(a)(8) and DCL GEN-11-07.  

MSU-Northern's current Official Cohort Default Rate is 0.0.