Federal Direct Loan (Unsubsidized)

This page is in the process of being updated for the 2018-2019 school year.

Experimental Sites Initiative

Effective with the 2012-2013 school year, San Diego City College (along with San Diego Mesa College and San Diego Miramar College) were approved by the U.S. Department of Education to participate in an experimental initiative regarding "Overborrowing" that allows our college to reduce or limit Unsubsidized Loan eligibility and borrowing for certain groups or categories of students.Based on this experiment, the following groups or categories of students will not be eligible to borrow Unsubsidized Loans.

1st Year Students

1st year is defined as a student who has completed less than 30 units in his/her current program or major based on the student's educational plan.
Units that will be counted towards the 30 units are units the fulfill the major, general ed or district requirements for your current program or major based on your educational plan.
Units that will not be counted towards the 30 units units that are basic skills or remedial, ESOL, electives or any other units that are not applicable to your current program or major based on your educational plan.

Students Approved on Appeal

If you have not met the Financial Aid Standards for Satisfactory Academic Progress (SAP) you will not be eligible for an Unsubsidized Loan even if you submit a Financial Aid Appeal and are approved for other aid.

New for 2016-2017

An exception has been made for students enrolled in the Nursing program (Nursing 108 and higher), they will be eligible to borrow an Unsubsidized Loan even if they are considered a 1st year student. Also, Nursing students who had to appeal the 90 unit limit only will be eligible for an Unsubsidized Loan. However, Nursing students who have to appeal the completion rate and/or GPA will not be eligible.

This exception does not apply to students enrolled in Pre-Nursing classes/prerequisite classes or for students enrolled in any other program or major.

Unsubsidized Loan Basic Information for Eligible Students

Unsubsidized loans are not recommended for most students. Unsubsidized loans were originally designed for middle income families that didn't qualify for grants or subsidized loans. You must apply for a Direct Subsidized loan before applying for an Unsubsidized loan. The interest rate for Unsubsidized loans for the 2017-2018 school year is shown below. 

 Loan TypeInterest


Rate Cap 
 Unsubsidized 4.45%8.25% 

Borrowing an Unsubsidized loan means interest will be charged while you are still attending school. Normally, you will start repaying the interest while you are still in school. This is a good strategy because you will pay less interest over the life of your loan.

However, you may also consider "Capitalization". If you Capitalize your loan, you will not pay the interest while in school. In this case, the interest will be be added to your unpaid principal balance. Capitalization increases the unpaid amount of your principal balance and interest is charged on the increased principal amount. This will greatly increase the total amount you repay over the life of your loan.

Unsubsidized Loan Categories

 The Federal Government does not make a distinction for the Unsubsidized loan program but we will refer to four different Unsubsidized loans categories to help explain the different eligibility criteria and the different loan processes. The loan categories are:

Students with No Need

Students with no need and who do not qualify for the Subsidized Loan may be eligible for: 

  • Up to $3,500 per year – 1st year student

  • Up to $4,500 per year – 2nd year student

  • Students can use the regular loan request form to apply for this Unsubsidized loan

  • No other special action or process needed by student
Dependent/Special Circumstances Unsubsidized 
  • Dependent students with a Rejected FAFSA because parents did not or will not provide their information
  • May borrow up to $2,000 per year
  • Students can use the regular loan request form to apply for this Unsubsidized loan 
Dependent Additional Unsubsidized

Dependent students can only qualify if their parents cannot borrow a PLUS loan due to various situations 
  • May borrow up to $2,000 per year
  • Students must complete Supplemental Loan Counseling and meet all other eligibility criteria
  • 1st year student does not qualify due to Experimental Site Initiative
Independent Additional Unsubsidized 
  • May borrow up to $6,000 per year

Additional Unsubsidized Loan Process (General Eligibility) 

  • Must complete a FAFSA for the 2017-2018 school year 
  • Must be enrolled in 6 or more units at San Diego City College for each semester
  • Must be in Good Standing based on the Financial Aid Satisfactory Academic Progress (SAP) standards and did not have to appeal 
  • The maximum amount for one semester will be one half (1/2) of the annual loan limit  

This page was last updated on 9/30/17 .