Loan Basics

First, the easy stuff: Your loan’s Master Promissory Note (MPN) is your written and signed promise to pay back what you borrowed. The MPN, however, is more than that. The note also outlines your rights and responsibilities as a borrower and contains instructions for deferment, repayment, and capitalization of interest.

Your interest rate is the biggest portion of your loan’s annual percentage rate (APR). The APR is the annual cost of borrowing, written as a percentage, that includes both interest and fees. For loans disbursed between July 1, 2018 and July 1, 2019, the APR is 5.05 percent for subsidized and unsubsidized loans for undergraduate students. If you want to check the interest rates of your other loans, look at the interest table Links to an external site. on the Federal Student Aid website.

Make sure you are familiar with any other additional terms and conditions of your loans.

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