Direct Subsidized/Unsubsidized Loan Timeline to Disbursement

Awarding of Direct Subsidized/ Unsubsidized Loans

We process student financial aid awards in two cycles. New student awarding begins in February (and returning student awarding begins in July for the upcoming academic year. You will receive a Financial Aid Notification via email once your award(s) is available to view in LionPath.

How to Accept Your Loan(s)

Once your loan has been awarded each academic year, you need to accept, decrease, or decline your loans in LionPATH. Keep in mind that we typically award for both Fall and Spring together, so you are accepting the total amount for the year.

If you are a new student, this option will be available after:

  • Your Penn State account is fully activated
  • You have completed the Financial Responsibility Agreement
  • We have turned on your accept, decrease, or decline, access - after the May 1st acceptance date

If you are a returning student, this option will be available once you have been awarded in mid-June.

Click here for more information about how to accept, decrease, or decline your awards.

Accept Decline Awards in LionPATHScreenshot of Accept/Decline Awards Page

Federal Loan Requirements

Once your award has been adjusted and/or accepted, first-time borrowers will need to complete:

  • Loan Entrance Counseling
  • Master Promissory Note (MPN)

In most cases, you will only need to complete these items once during your college career. You can complete these requirements at any time once you have been accepted to Penn State. Once we begin to process your loan(s), these items will be presented to you in your ‘To Do List’ in LionPath if they are still incomplete. Once these items are completed on, notification will be sent electronically to us in approximately 2-3 business days. At that time, your To Do List item will be removed from your LionPath record.

Screenshot of MPN and Loand Entrance

Transfer Monitoring

Federal regulations require Penn State to confirm whether or not you have taken credits at another institution during the most recent academic year. Updated federal loan (and federal Pell) information from the National Student Loan Data System (NSLDS) will be requested to verify this information, and a temporary hold will be placed on your record.

If you have not used federal aid in the most recent academic year, you will not have to take any action. Once the updated information loads in 8 - 10 days, the hold will automatically be removed from your record.

If you have used federal aid in the most recent academic year, or if you have aid pending at another institution you should be in contact with that school to cancel the aid at the Common Origination and Disbursement (COD) System federal database. We will manually review your record, make any aid adjustments if necessary, and remove the hold.

This hold will not interrupt the awarding of financial aid or scheduling your courses; however, it will prevent your aid from disbursing until the review of your record is complete.

Respond to Verification

Verification will be presented to you in your ‘To Do List’, (if you are selected), after you have responded to your offer of admission.

Screenshot of Holds and To Do List in LionPATH

Verification is a federal mandate requiring universities to confirm the accuracy of the information reported on the Free Application for Federal Student Aid (FAFSA). You will receive an email from our office, which explains what documentation must be provided if you are selected for verification. Verification requests will also be displayed on the "To Do List" located on the Home page of your LionPATH account.

Follow all directions, and respond quickly to this request to avoid a delay in the processing of your aid. Parental signature is required on the verification documents for dependent students.

Your To Do List Item will show as "Received" once the information is received, reviewed, and then manually updated by our office. This is not automatically updated when you upload the item(s). The to do list is typically updated in approximately 3-5 business days, unless we are in peak processing when volumes increase dramatically.

Loans as a Credit on Your Student Account Statement

Billing begins in early August for fall semester, January for spring semester, and May for summer semester. Your Direct Subsidized/Unsubsidized loans will appear as anticipated aid on your student account statement once you have:

  • Met the minimum eligibility requirements
  • Accepted the loans in LionPath
  • Completed your Federal requirements (MPN/LEC)
  • Complied with verification (if selected)

Disbursement of Funds

After you have completed all of the steps to finalize your aid and semester classes begin, your financial aid will disburse into your account and be credited towards your tuition bill. Pay special attention to your LionPATH Student Center for any Holds and To Do List items as this may prevent the timely disbursement of your aid.

Screenshot of Student Account Page in LionPATH

Per federal regulation, we can begin the disbursement process of federal funds no earlier than 10 days prior to the semester begin date. Summer loans will not be disbursed at the beginning of the semester. The disbursement date will be 10 days prior to the start of Session II. Short term loans are available at your campus aid office for students who have started their classes in May and are expecting a refund to pay for living expenses.

Student's attending an Education Abroad program will have their loan(s) disbursed in two separate disbursements per federal regulation. For Summer 2019, those dates will be June 17th and June 24th.


  • You will receive your loan disclosures from your federal direct loan servicer indicating that this date will be your actual disbursement date, however, this is only an estimated date of disbursement.
  • The process to request Federal Direct Loan funds and disburse them into your student account will take approximately 3-5 business days.
  • Be aware that once the funds disburse, they will no longer show as anticipated aid. However, within the same day, you will see the funds posted to your student account.
  • Monitor your PSU email for messages regarding aid disbursement and refunds.
  • Monitor your National Student Loan Database System (NSLDS) information (by logging into for loan disbursement updates and loan servicer assignments.