1. Package Title IV loans
  2. How SFP handles Direct Subsidized and Direct Unsubsidized Loans

4How SFP handles Direct Subsidized and Direct Unsubsidized Loans

Oracle Student Financial Planning (SFP) determines Direct Loan eligibility and award amounts using federal limits, grade level, dependency status, proration rules, and projected borrowing across the student’s program.

Determines annual loan limits for Direct Subsidized and Direct Unsubsidized Loans

Grade levels are determined by calculating the total number of credits that can be applied toward program completion and the institution's academic year definition. Calculating the number of credits to use toward program completion includes summing the total number of credits completed and accepted transfer credits. Unacceptable transfer credits, credits earned from taking courses that aren't applicable to the program, and or credits earned before the start of the current program that don't count toward program completion aren’t used when determining the student's current grade level. Once the current grade level is determined, future grade levels for the remainder of the student's program are projected.

For undergraduate students, the dependency status from the student’s Institutional Student Information Record (ISIR) is considered to determine if the student is eligible for the dependent or independent unsubsidized loan limit.

Determines aggregate and lifetime limits for Direct Subsidized and Direct Unsubsidized Loans

SFP packaging uses National Student Loan Data System (NSLDS) aggregate loan history, when available, to determine a student’s remaining annual or aggregate eligibility for Direct Loans. The calculation method is the same across loan types. However, the applicable limit and the NSLDS aggregate field or fields vary by fund and borrower type.

Borrowers with a loan limit exception aren’t subject to the new annual and aggregate loan limits while the exception applies.

For borrowers without an exception, the new lifetime aggregate loan limits apply:

  • New lifetime limit: $257,500 for all combined undergraduate, graduate, and professional-level Direct Loans. This applies to total amounts borrowed, including repaid, canceled, forgiven, or discharged loans.

  • Exclusions: doesn't include Parent PLUS Loans, Graduate PLUS Loans, Consolidation Loans, or HEAL/Health Professions Loans.

If an NSLDS record exists, packaging calculates remaining eligibility using this formula:

Remaining Eligibility = Applicable Limit + NSLDS Aggregate Total + Total Student Financial Aid (SFA) Loan Amount + Sum of Disbursement Amounts

Where:

  • Applicable Limit (Aggregate Limit) is the applicable aggregate limit for the loan type.
  • NSLDS Aggregate Total is the applicable NSLDS aggregate value for the loan type.
  • Total SFA Loan Amount is the applicable institution-originated loan amount that’s included in the aggregate calculation.
  • Sum of Disbursement Amounts is the applicable total of disbursements used in the calculation.

If no NSLDS record exists, packaging treats the student as having maximum aggregate eligibility and doesn't limit eligibility based on loan history.

Note:

Some aggregate lifetime limits are based on combined Direct Loan borrowing, including both subsidized and unsubsidized amounts. In these cases, prior subsidized borrowing can reduce remaining eligibility even when packaging an unsubsidized loan.

Determines grade level and annual and aggregate loan limits for graduate Direct Unsubsidized Loans

  • New classifications for graduate versus professional students

    Starting with the 2026–27 award year, the One Big Beautiful Bill introduces new classifications for students who receive Direct Unsubsidized Loans. These classifications determine whether a student is considered graduate or professional, and they have different annual and aggregate loan limits.

    A professional student is defined by US Department of Education (ED) regulation as a student who is enrolled in a program that awards a professional degree, such as M.D., Pharm.D., J.D., D.D.S., or D.V.M., and typically requires professional license to practice.

    These conditions apply to professional students:

    • The student must not receive Title IV aid as an undergraduate student for the same period of enrollment.
    • The professional degree must represent both completion of the academic requirements needed to begin practice in the profession and a level of professional skill beyond what’s normally required for a bachelor’s degree.
    • The professional degree is generally at the doctoral level and requires at least six academic years of postsecondary education, including at least two years of postbaccalaureate work.

    A graduate student is defined by ED regulation as a student who is enrolled in a program that awards a graduate credential, such as a master’s degree, on completion but isn’t classified as professional under ED definitions.

  • New annual and aggregate loan limits

    Borrowers with a loan limit exception aren’t subject to the new aggregate loan limits while the exception applies.

    For borrowers without an exception, new separate graduate and professional loan limits apply. Undergraduate loans don’t count toward these new limits.

    Student Type Annual Unsubsidized Limit Aggregate Unsubsidized Limit
    Professional $50,000/year $200,000
    Graduate (no prior professional enrollment) $20,500/year $100,000
    Graduate (prior professional enrollment) $20,500/year $200,000
    Note: Previously, the annual and aggregate limits for graduate and professional students were $20,500 and $138,500 respectively.

  • Grade level changes

    Starting with the 2026–27 award year, six new grade and academic levels, 8 through 13, are introduced to separately categorize different types of graduate and professional students. These new levels replace levels 6 and 7.

    • 8: Graduate Never Professional
    • 9: Graduate was Professional
    • 10: Professional Never Graduate
    • 11: Professional was Graduate
    • 12: Graduate Concurrent Enrollment
    • 13: Professional Concurrent Enrollment

    Configuration will allow schools to determine a grade level that aligns with ED requirements. SFP reports this determined value as the student level code in COD communications.

Determines additional unsubsidized limits for Direct Loans

Additional unsubsidized Direct Loan awards are calculated by determining the grade level limit up to the independent grade level limit considering any loans that overlap the current loan period using NSLDS data.

Dependent students whose 'PLUS Loan Denial Indicator' is true on the ISIR are automatically considered for additional unsubsidized Direct Loan funds. A dependent student's unsubsidized Direct Loan amount can also be manually increased beyond the grade level limit for combined subsidized and unsubsidized Direct Loans.

  • If the application awards a student additional unsubsidized Direct Loans due to a PLUS denial, it automatically sets the 'Additional Unsubsidized Eligibility Indicator' to true when reporting the loan to Common Origination and Disbursement (COD).
  • If you manually award additional unsubsidized Direct Loans, you can set or unset 'Additional Unsubsidized Eligibility Indicator.' For more information on editing funds, see Add, Edit, or Remove a TIV Fund.

In either case, the application sets the 'Additional Unsubsidized Eligibility Indicator' to true when reporting the loan to COD.

Students in selected medical programs can also receive additional unsubsidized Direct Loan funds. The amount is determined using the student’s academic program and fund configuration.

Configuring additional unsubsidized Direct Loans for students in selected medical programs isn't part of the baseline configuration. To set this up, you need to update the FAS Fund Config workbook (FAS_FUND_CONFIG.csv):

  1. In the Fund_Code column, enter DUNSUB.
  2. Reference a Groovy script in the Medical_Eligible_Program_Amount_Info column. In this script, you can determine which programs are eligible for the additional unsubsidized Direct Loan amounts and how much a student should receive. When students are awarded Direct Loans using this script, the fund description includes "Medical"

For any student receiving additional unsubsidized Direct Loan funds in a selected medical program, the application sets the 'HIPPA Indicator' to true when reporting the loan to COD.

Determines if the loan limit needs to be prorated

The application prorates the student's loan limit if the student is in an undergraduate certificate program and the program length is less than a standard academic year.

To prorate the loan limit, the application multiplies the student's loan limit (based on grade level) by the lesser of the following ratios:

  • Remaining Program Credits ÷ Academic Year Definition Credits

  • Remaining Program Weeks ÷ Academic Year Definition Weeks

If the student is in an undergraduate bachelor's program and the Borrower-Based Academic Year (BBAY) has a partial academic year, the application prorates the student's loan limit. To prorate the loan limit, the application multiplies the student's loan limit (based on grade level) by the following ratio:

Remaining Program Credits ÷ Academic Year Definition Credits

To identify the final academic year to be considered for proration, SFP uses the last academic year received in the Student Academic and Financial Information (SAFI) message. To ensure correct Direct Loan calculations, all academic years up to the end of the student's program must be sent in the SAFI Message.