Transfers	Between	Programs	at	the	Same	School
Unless	a	student	is	considered	to	remain	in	the	same	loan	period	and	payment	period	(see	below),	when	a	student
transfers	within	the	same	academic	year	from	one	program	to	a	different	program	at	the	same	school,	and	the	new
program	is	a	clock-hour,	non-term,	or	non-SE9W	nonstandard	term	program,	the	school	may	originate	an	initial	loan	for
the	new	program	with	an	abbreviated	loan	period	that	ends	on	the	calendar	period	ending	date	of	the	academic	year
associated	with	the	prior	program.	The	same	abbreviated	loan	period	rules	that	apply	when	a	student	transfers	from	one
school	to	another	school	(see	above)	also	apply	when	a	student	transfers	within	the	same	academic	year	to	a	new
program	at	the	same	school.
If	certain	requirements	are	met,	when	a	student	who	has	received	a	Direct	Loan	for	one	program	transfers	to	a	different
program	at	the	same	school,	you	have	the	option	of	considering	the	student	to	remain	in	the	same	payment	period	and
loan	period.	Otherwise,	you	must	place	the	student	in	a	new	payment	period	and	originate	a	new	loan	with	a	new	loan
period.
Same	Payment	Period	and	Same	Loan	Period
At	your	option,	you	can	consider	a	student	who	transfers	from	one	program	to	another	program	at	the	same	school	to	be
in	the	same	payment	period	and	loan	period	if	all	the	following	conditions	apply:
The	student	is	continuously	enrolled	at	the	school;
The	coursework	in	the	payment	period	the	student	is	transferring	out	of	is	substantially	similar	to	the	coursework	the
student	will	be	taking	when	they	first	transfer	to	the	new	program;
The	student9s	current	payment	period	and	the	payment	periods	that	would	otherwise	apply	in	the	new	program	are
substantially	equal	in	length	in	weeks	of	instructional	time	and	credit	or	clock	hours;
There	are	few	or	no	changes	in	school	charges	associated	with	the	transfer	to	the	new	program;	and
The	credits	or	clock	hours	from	the	payment	period	the	student	is	transferring	out	of	are	accepted	toward	the	new
program.
If	you	choose	to	keep	the	student	in	the	same	payment	period,	the	loan	period	for	the	loan	the	student	received	for	the
first	program	would	also	remain	the	same.	However,	you	must	consider	any	changes	as	to	when	the	student	is	expected
to	complete	the	hours	and	weeks	of	instructional	time	of	the	academic	year	and	make	any	necessary	adjustments	to	the
A	dependent	first-year	undergraduate	student	receives	the	first	disbursements	of	a	Direct	Subsidized	Loan
($1,750)	and	Direct	Unsubsidized	Loan	($1,000)	at	School	A.	The	loan	period	and	academic	year	dates	are	January
26	to	July	31.
The	student	leaves	School	A	and	transfers	into	a	300	clock-hour/12-week	program	at	School	B	on	June	15.	School
B	defines	its	Title	IV	academic	year	as	containing	900	clock	hours	and	26	weeks	of	instructional	time.	The
combined	subsidized	and	unsubsidized	prorated	annual	loan	limit	for	the	300-hour	program	at	School	B	is	$1,815,
not	more	than	$1,155	of	which	may	be	subsidized	(see	Chapter	5	of	this	volume	for	guidance	on	calculating
prorated	annual	loan	limits).
For	the	abbreviated	loan	period	at	School	B	(June	15	to	July	31),	a	transfer	student	would	normally	be	eligible	to
receive	the	difference	between	the	full	first-year	annual	loan	limit	and	the	loan	amount	received	at	School	A	(that
is,	an	additional	$1,750	subsidized	and	$1,000	unsubsidized).	In	this	example,	however,	the	student	may	not
receive	those	amounts,	because	they	would	exceed	the	prorated	annual	loan	limits	for	the	300	clock-hour
program.	Therefore,	the	maximum	loan	amount	the	student	may	receive	for	the	program	at	School	B	(for	the
abbreviated	loan	period	and	any	subsequent	loan	period	combined)	is	a	total	of	$1,815,	not	more	than	$1,155	of
which	may	be	subsidized	(the	prorated	loan	limits	for	the	program).	If	the	student	receives	the	maximum	prorated
loan	limit	for	the	program	during	the	abbreviated	loan	period,	there	is	no	remaining	loan	eligibility	for	the
program	following	the	completion	of	the	abbreviated	loan	period.
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