Loan Program

Babson participates in the federal student loan programs, and we strongly recommend that all U.S. citizens and permanent residents of the U.S. apply for federal student loans before pursuing any other loan option.

Follow the instructions for applying for financial aid here to be considered for the federal and state student loans listed in this section. In addition, please read UG Loan Policy Statement June 2026.pdf

Federal Direct Loan

The Federal Direct Loan is the most widely available student loan for U.S. citizens and permanent residents.
Students are eligible to borrow up to the following amounts through the Federal Direct Loan program:

	Maximum loan amount	Maximum portion that can be subsidized
First Year	$5,500	$3,500
Second Year	$6,500	$4,500
Third Year	$7,500	$5,500
Fourth Year	$7,500	$5,500

For students enrolled less than full-time but at least half-time in any semester, your loan amount will be prorated based on your enrollment as a percentage of full-time status.
Independent students can borrow additional amounts through the Direct Unsubsidized Loan program.
For students who qualify for the Direct Subsidized Loan, the interest is paid by the federal government while students are in school at least half-time.
For students who don't qualify for the subsidy, interest begins accruing at the time of the loan disbursement. Students can elect to pay the interest while in school or have it capitalized into a repayment schedule that starts six months after the student leaves school.
Borrowers are required to sign a Master Promissory Note and to complete entrance and exit loan counseling.
Loan funds are issued in two disbursements each year, typically timed to coincide with the start of each semester. Students are notified via email each time Federal Direct Loan funds are credited to their accounts.
You can find details about interest rates and federal loan fees here.

Mass No Interest Loan

For Massachusetts residents with the greatest financial need.
No fees, and interest rate is fixed at 0%.
Repayment begins 6 months after the student leaves school.
Limited funds are available.

Additional Loan Options

For students and parents who need financing beyond what is available through the federal student loan programs, we offer a list of recommended loans and lenders:

Student and Parent Alternative Loan Options

A co-signer with a strong credit history will increase a student’s chances of being approved for an alternative/supplemental loan. If you are an undergraduate who is planning to ask a parent to serve as a co-signer, you should also consider the parent loan options to ensure that, as a family, you are getting the best rates available to you. We use the following criteria in developing our list of recommended loans and lenders:

Loan terms and cost to borrower
Borrower benefits
Differentiated options (fixed rate vs. variable rate loans, for-profit vs. non-profit organizations, regional vs. national lenders)

You are in no way limited to loans/lenders on our list of options. Babson will process a loan from any lender, and it is your right to apply for loans through the lender of your choice.

Federal Direct Parent PLUS Loan Program

Parents who wish to borrow through the Federal Direct Parent PLUS Loan should complete the application, Master Promissory Note, and entrance counseling.
You can find details about interest rates and federal loan fees here.
Effective for new borrowers as of 7/1/2026, the annual limit is $20,000, up to a cumulative maximum of $65,000.

NOTE: for existing PLUS loan borrowers prior to 7/1/2026, the maximum amount is the cost of attendance, less any financial aid awarded. This exception is valid until the completion of the student’s program or 3 additional academic years, whichever comes first.