A	dependent	student	is	enrolled	in	a	two-year	credit-hour	program	offered	in	standard	terms	(quarters).	The
school	defines	the	academic	year	for	the	program	as	36	quarter	hours	and	30	weeks	of	instructional	time
(covering	three	quarters:	fall,	winter,	and	spring).
The	student	has	attended	the	program	for	six	quarters	(two	academic	years),	but	to	finish	the	program	needs	to
complete	an	additional	six	hours	(half	time)	in	the	fall	quarter	of	the	next	academic	year:
Fall
(half	time:	6	hours)
Winter
(not	enrolled)
Spring
(not	enrolled)
To	determine	the	prorated	Direct	Loan	limit	for	the	student9s	remaining	period	of	study	(one	quarter),	convert	the
fraction	based	on	the	hours	that	the	student	is	expected	to	attend	and	the	hours	in	the	academic	year	to	a
decimal:
6	hours	in	fall/36	hours	in	academic	year	=	0.17
Multiply	this	decimal	by	the	combined	Direct	Subsidized	Loan	and	Direct	Unsubsidized	Loan	annual	loan	limit	for	a
dependent	second-year	undergraduate	($6,500,	not	more	than	$4,500	of	which	may	be	subsidized):
$6,500	x	0.17	=	$1,105	combined	subsidized	and	unsubsidized	prorated	annual	loan	limit
To	determine	the	maximum	portion	of	the	$1,105	prorated	annual	loan	limit	that	the	student	may	receive	in
subsidized	loan	funds,	multiply	the	maximum	subsidized	annual	loan	limit	of	$4,500	by	the	same	decimal	(0.17):
$4,500	x	0.17	=	$765	subsidized	prorated	annual	loan	limit
The	maximum	combined	Direct	Subsidized	Loan	and	Direct	Unsubsidized	Loan	amount	the	student	can	borrow	for
the	remaining	portion	of	the	program	is	$1,105,	not	more	than	$765	of	which	may	be	subsidized.
Volume	8,	Chapter	5,	Example	4:	Remaining	Period	=	Two	Semesters,	With	Less	Than	Half-Time	Enrollment	in	One
Term
The	student	from	Example	3	transfers	to	a	BA	program	at	a	different	school.	The	academic	year	for	the	program
contains	two	semesters,	fall	and	spring.	During	the	second	year	of	the	BA	program,	the	student	will	be	enrolled
full	time	in	the	fall	and	less	than	half	time	in	the	spring,	and	will	graduate	at	the	end	of	the	spring	term:
Fall
(full	time)
Spring
(less	than	half	time)
Although	the	student	is	not	eligible	to	receive	a	Direct	Loan	for	the	spring	term,	the	remaining	period	of	study
(two	semesters)	is	equal	to	a	full	academic	year.	Therefore,	proration	of	the	annual	loan	limit	is	not	required	if	the
student	receives	a	Direct	Loan	for	the	fall	term.
Volume	8,	Chapter	5,	Example	5:	Remaining	Period	Shorter	Than	an	Academic	Year,	With	Less	Than	Half-Time
Enrollment	in	One	Term
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