Annual loan limit is the maximum a student can borrow in a particular year. This may be a combination of the fixed limit based on grade level along with a requirement not to exceed the cost of attendance less other forms of financial aid. Direct loans have annual loan limits In the first year, a student can borrow up to $5,500 minus any Direct Subsidized Loan funds. In the second year, the borrower can have up to $6,500 minus any Direct Subsidized Loan funds. For third undergraduates and beyond, the cap of subsidized loan funds is $7,500 minus any Direct Subsidized Loan funds. Graduate or professional students can borrow up to $20,500 each year in Direct Unsubsidized Loans and the cost of attendance minus other forms of aid. Also, some private lenders have established annual loan limits.