California DREAM Loan Program

How it works

Currently, undocumented students who graduate from a California high school and meet the California Dream Act requirements are eligible for state and university aid, but ineligible for federal aid (including federal loans). The DREAM loan program, funded by the state and UC, aims to close that gap and provide eligible students with the opportunity to borrow student loans to help pay for their education.

If you're an undocumented AB 540 undergraduate, here's what you need to know:

• A loan is borrowed money (you may hear terms like "borrowing" or "taking out loans" ) that you have to pay back with interest.
• Each UC campus will determine the amount a student can borrow based on available funding and number of eligible students. The maximum amount of a loan is capped at $4,000 each year, per student – but again, this is dependent on program funding.
• You can borrow every year you're an eligible student at UC or until you receive a maximum of $20,000 in DREAM loans.

DREAM Loan details

• The DREAM Loan interest rate is the same as the Federal Direct Subsidized Loan. If you borrow through the DREAM loan program in one academic year, the interest rate will not change for that loan. However, the interest rate for future loans may be different.
• Interest will not accrue on the loan as long as you're a student enrolled at least half time.
• Once you graduate (or you cease being at least a half-time student), there is a 6-month "grace period" before you have to start paying back the loan.

Who's eligible

Undocumented AB 540 undergraduates who:

• Have financial need
• Are enrolled at least half time at UC

What you need to do

• Make sure you apply for financial aid by filing a California Dream Act application. There are no separate forms required to apply for the California DREAM Loan Program, but you'll need to apply for financial aid every year to be considered for the DREAM Loan Program.
• You may see a DREAM Loan offered as part of your financial aid award letter. You do not need to accept the loan if you don't want to — it's optional.
• If you're interested in borrowing from the California DREAM Loan Program, but don't see an offer in your financial aid award letter, reach out to the campus financial aid office.
• Make sure to check your email and your campus student portals on a regular basis in case the financial aid office contacts you.