There are specific limits for federal financial aid programs. Since July 1, 2013, first time borrowers of subsidized loans are limited to a maximum time of 150% of the length of the student’s program. This means that those in a four-year program are limited to six years of loans while those in two-year programs are limited to three years of loans.
Unsubsidized and PLUS loans do not have a time limit. These programs are limited to specific to amounts that can be borrowed each year with maximum limits for undergraduate and graduate students depending on their dependency status. These limits include any subsidized loans received. The following table from the Federal Student Aid website shows the current limits.
|
Year |
Dependent Students (except students |
Independent Students |
|
First-Year Undergraduate Annual Loan Limit |
$5,500—No more than $3,500 of this amount may be in subsidized loans. |
$9,500—No more than $3,500 of this amount may be in subsidized loans. |
|
Second-Year Undergraduate Annual Loan Limit |
$6,500—No more than $4,500 of this amount may be in subsidized loans. |
$10,500—No more than $4,500 of this amount may be in subsidized loans. |
|
Third-Year and Beyond Undergraduate Annual Loan Limit |
$7,500—No more than $5,500 of this amount may be in subsidized loans. |
$12,500—No more than $5,500 of this amount may be in subsidized loans. |
|
Graduate |
Not Applicable (all graduate and professional students are considered |
$20,500 (unsubsidized only) |
|
Subsidized and Unsubsidized Aggregate Loan Limit |
$31,000—No more than $23,000 of this amount may be in subsidized |
$57,500 for undergraduates—No more than $23,000 of this amount may be in |
Pell Grants are limited to the equivalent of six years of funding. Students who receive Pell Grants are allowed 600% of Lifetime Eligibility Use (LEU). If for some reason the student doesn’t receive 100% of the eligible amount for a Pell Grant, she could receive the amount in subsequent years. You can see an example of LEU at the StudentAid.gov website. The most common reason for not receiving a full award is to drop below full-time status.