I haven’t waded into the loan arena but I swear that I have often seen in these boards that students are limited to $5000 a year and it goes up to $7500 a year maybe junior year. Do I have that right? But in talking with a mom friend, she insists that it’s $12,500 a year for undergrad and when I looked it up, it does look like that’s accurate. Is is a difference between type of loan?
“If you are an undergraduate student, the maximum amount you can borrow each year in Direct Subsidized Loans and Direct Unsubsidized Loans ranges from $5,500 to $12,500 per year, depending on what year you are in school and your dependency status.” https://studentaid.ed.gov/sa/types/loans
This link has a handy dandy chart, for dependent/independent and undergrad/grad students. https://www.savingforcollege.com/article/annual-and-aggregate-student-loan-limits
Your friend is correct IF the student’s parent are turned down for the Parent Plus loan. The student is then allowed to take either $4000 (freshman and sophomore years) or $5000 (jr/sr), for a total of up to $12500. It is $5500/$6500/$7500/$7500 direct loan plus the $4000/$5000 extra. This only happens if the parents are turned down for the Plus loan, and that isn’t that hard to qualify for. I think the FA office can also approve this extra $4000/$5000. Not that long ago, there were also Perkins loans but those are no longer made.
Note that only $3500-$5500 can be subsidized. $12k (almost $50k total) per year makes for a hefty repayment.