This new rule encourages students to graduate from their program in a reasonable amount of time in an effort to reduce the total amount of loan debt incurred. Students who change majors multiple times or withdraw from classes excessively are most likely to be affected.
Generally, if you are enrolled in a 4-year bachelor’s degree program, you will have 6 years of Direct Subsidized Loan eligibility (or 150% of the program length) to graduate. This does not impact unsubsidized or parent loans.
Examples of how the calculation works:
View more information from the Department of Education.
Important: If you meet the maximum time frame and have not completed your program, you will not be eligible to borrow any additional subsidized loans and your current subsidized loan(s) will begin to accrue interest.