150% Subsidized Usage Period Limitations
Changes that took effect for first-time borrowers as of July 1st, 2013 require that subsidized loan eligibility be limited to 150% of the published length of a program.
This means that your eligibility for – and benefits from – subsidized loans end when you borrow subsidized loans for 150% or more of the time needed to complete your program of study.
This also means that once you reach or exceed 150% of the weeks required for your program of study, all of your subsidized loans will change to unsubsidized loans for the remainder of your repayment.
Students who complete their degrees/certificates before hitting this threshold will not be subject to losing their subsidized benefits. Find more information on subsidized loan eligibility rules at the U.S. Dept. of Education website.
150% Subsidized Usage FAQs
Who is affected by this rule?
Students who have zero student loan balances as of July 1, 2013.
When will this affect borrowers?
Once they reach 150% of the timeframe published for their program of study.
What does 150% of the published timeframe mean?
Each program of study has a published timeframe for how long it takes to complete. The average Associates degree at Pima takes approximately 2 years to complete: 150% of this would be 3 years. A full-time student who is enrolled in a 2-year program of study MUST complete that degree before 3 years of borrowing subsidized Stafford loans. This time limit will differ based on your program of study and how many credit hours you take per semester. Please refer to your program of study to learn the published length of time for your program.
What if I don't borrow Subsidized loans for all periods of enrollment?
Your 150% time limit only counts periods that you borrow subsidized Stafford loans. Periods when you did not borrow them will not be counted towards your timeframe.
What happens to Subsidized loans I've borrowed if I hit the 150% Subsidized Usage Period Limit?
Your existing subsidized loans will essentially be converted to unsubsidized loans, which means that the government will no longer subsidize the interest on your loans. That means all interest accrued on the loans moving forward, is accruing in your name.
SALT provides a more complete listing of frequently asked questions and how this could directly impact you.