Direct loans come directly from the government rather than through a channel of private lenders. Some basic requirements to be eligible for direct loans are as follows:-
• The applicant must be a citizen of the United States.
• The applying student should have enrolled in an undergraduate, postgraduate or other educational programs or at least a certificate course in a school that is eligible to forward students for direct loans.
• Students of all educational institutions cannot apply for direct loans.  The educational body should be registered and should have been approved to forward students for direct loans.
• The parents of the dependent students can apply on behalf of the students.
• Every application for the direct loans should be forwarded through the school and not privately.
• The fund from the direct loans for a student will be released to the account of the school after which it will be disbursed by the school to the student.
• Students that withdraw from the course during the processing time of the direct loans will not be eligible to use the loan for some other school even if it gets sanctioned.
• All direct loans are sanctioned based on the eligibility certificate as issued by the school.  Even after the loan has been sanctioned if the school feels that the eligibility certificate was issued by mistake, then the loan could be withheld.
• Any kind of direct loans that is obtained by furnishing false credential or other details will be subject to serious punishment if detected at a later point in time.

The direct loans can be used for several purposes by a student; it can be used to consolidate all the loans that one has obtained from previous schools also. It can be used to pay for tuition fee, hostel fee, books, examination fee etcetera. Like any other loan, non repayment will show up as bad scores.

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