Responsible Borrowing - Loans
Loans are an excellent way to finance your education.
Undergraduate and graduate students, and parents of dependent students
may borrow money to pay towards education expenses. The
money that is borrowed needs to be repaid with interest with a variety
of repayment options available.
Federal
Direct Student Loan Programs
Federal
Perkins Loan
Description/Benefits
Federally
funded (limited funding)
Need-based
5 percent
fixed interest rate
Awarded
to exceptionally needy students
Funds
may not be available for students who apply after April 1 for the upcoming aid year
This
is a loan you must repay
Complete
the Return of Disbursed Federal Loans if you wish to cancel
your loan or return funds you do not need. If funds are returned
within 120 days of the disbursement date or by your last day of
enrollment for the academic year, whichever is sooner, any interest
will be waived.
The
annual loan limit is $4,000 for undergraduate students and $6,000
for graduate students.
The
aggregate loan limit is $20,000 for undergraduate students and $40,000
for graduate students (including loans received as an undergraduate).
Additional
information available on the Federal
Perkins MPN Information Sheet
Eligibility
Undergraduate,
graduate student or teacher certification
Award
eligibility based upon EFC, enrollment and other resources
Award
may be adjusted or canceled if EFC changes or student receives additional
resources .
Repayment
Repayment
deferred and interest waived while enrolled at least half time
Begin
to repay loan nine months after you cease to be enrolled at least
half time. During this nine-month "grace period" interest
will not accrue on loan. Once the grace period expires, your loan
will accrue interest and you will begin to repay your loan.
If
you drop to less than half time, withdraw, drop out, graduate or
simply do not return to school, this information will be reported
to the servicer and they will begin to count your grace period.
You are responsible for notifying your school immediately if your enrollment
changes as described above.
Payments
will be made to (holder of the loan)
Payments
will be made through ECSI.
For
information about Federal Perkins Loan deferments or cancellation
of your loan, visit ECSI website at www.ecsi.net
To
obtain information about consolidating your Federal Perkins Loan
with your Federal Direct Loans, visit loanconsolidation.ed.gov/ or call 1-800-557-7392. Federal consolidation allows you to refinance
all of your federal loans into one loan and you will have one payment
each month.
It
is important that you maintain a "very important Perkins file" and
keep copies of your award notices and your MPN in one place as they
provide the details of your loans, and your rights and responsibilities
as a student loan recipient.
Federal
Direct Subsidized Loan
Contact Information
Direct
Loan Servicing Center
(repayment information)
(800) 848-0979
www.dlssonline.com/
Direct
Loan Consolidation Center
(consolidation)
(800) 557-7392
Description/Benefits
Federally
funded
Need-based
The fixed interest rate for loans in the deferment or six-month grace period as of July 1, 2008 is as follows:
- 6.0 percent for undergraduate loans first disbursed July 1, 2008,
and after
- 6.8 percent for graduate loans first disbursed July 1, 2006, and
after
- 6.8 percent for undergraduate loans disbursed July 1, 2006 through
June 30, 2008
2 percent origination fee minus 1.5 percent rebate, subtracted prior to disbursement, effective July 1, 2008
Awarded
by your school as Federal Direct Subsidized on award notice
Subject
to annual and aggregate loan limits
This
is a loan you must repay to the U.S. Department of Education
Complete
the Return of Disbursed Federal Loans if you wish to cancel
your loan or return funds you do not need. If funds are returned
within 120 days of the disbursement date or by your last day of
enrollment for the academic year, whichever is sooner, any interest
will be waived.
After
you have accepted your subsidized loan, you will receive a "Federal
Direct Loan Disclosure Statement" from the Direct Loan Servicing
Center of your school. The Disclosure Statement identifies anticipated
disbursement dates, gross and net disbursement amounts, and loan fee
amounts for all your Federal Direct Loans for the academic year.
Eligibility
Completed Federal Direct
Master Promissory Note (MPN) required for first-time borrowers
Direct
Loan Entrance Counseling required for first-time borrowers.
Award
eligibility based upon EFC, cost of attendance, enrollment and other
resources
Award
will be canceled if enrolled less than half time
Award
may be adjusted or canceled if there is a change to EFC, cost of
attendance, enrollment, graduating in August or December or receipt of additional resources
Undergraduate,
graduate student or teacher certification
Must
be enrolled at least half time
Completed Financial
Aid Adjustment Form required to accept the loan
Repayment
Repayment
deferred and interest waived while enrolled at least half time
Begin to repay loan 6 months after you cease to be enrolled at
least half time. During this 6 month "grace period", interest
will not accrue on loan. Once the grace period expires, your loan
will accrue interest and you will begin to repay your loan. For sample
repayment amounts, see Federal
Loan Repayment Chart
Complete
an exit
counseling session so you are aware of all the information you
will need to know about repaying your loan.
If
you drop to less than half time, withdraw, drop out, graduate or
simply do not return to school, this information will be reported
to the servicer and they will begin to count your grace period.
You are responsible for notifying your school immediately if your enrollment
changes as described above.
Payments
will be made to the U.S. Department of Education (holder of the
loan)
For
detailed information about repayment, deferments, forbearance, and
other frequently asked questions, go to www.dlssonline.com/
To
obtain information about consolidating your Federal Direct loans,
visit loanconsolidation.ed.gov or call 1-800-557-7392. The interest rate for a Direct Consolidation
Loan is the weighted average of the interest rates on the loans
being consolidated and is fixed for the life of the loan.
It
is important that you maintain a "very important papers file" and
keep copies of your award notices, MPN, Borrower's Rights and Responsibilities
and the Direct Loan Disclosure Statement in one place as they provide
the details of your loans, and your rights and responsibilities as
a student loan recipient.
Federal
Direct Unsubsidized Loan
Contact Information
Direct
Loan Servicing Center
(repayment information)
(800) 848-0979
www.dlssonline.com/
Direct
Loan Consolidation Center
(consolidation)
(800) 557-7392
Description/Benefits
Federally
funded
Non
need-based
The
fixed interest rate for loans in the deferment or six-month grace period is as follows:
- 6.8 percent for undergraduate and graduate loans first disbursed
July 1, 2008, and after
Interest
starts accruing upon disbursement
2 percent
loan origination fee minus 1.5 percent rebate, subtracted prior to disbursement, effective July 1, 2008
Awarded
byyour schools Federal Direct Unsubsidized loan on award notice
Subject
to annual and aggregate loan limits
This
is a loan you must repay to the U.S. Department of Education
Complete
the Return of Disbursed Federal Loans if you wish to cancel
your loan or return funds you do not need. If funds are returned
within 120 days of the disbursement date or by your last day of
enrollment for the academic year, whichever is sooner, any interest
will be waived.
After you have accepted your unsubsidized loan, you will receive
a "Federal Direct Loan Disclosure Statement" from the Direct
Loan Servicing Center or your school. The Disclosure Statement identifies
anticipated disbursement dates, gross and net disbursement amounts,
and loan fee amounts for all your Federal Direct Loans for the academic
year.
Eligibility
Undergraduate,
graduate student or teacher certification
Must
be enrolled at least half time
Completed Financial
Aid Adjustment form required to accept the loan
Completed Federal Direct
Master Promissory Note required for first-time borrowers
Loan
Entrance Counseling required for first-time borrowers
Award
eligibility based upon EFC, enrollment and other resources
Award
will be canceled if enrolled less than half time
Award
may be adjusted or canceled if there is a change to cost of
attendance, enrollment, graduating in or receipt of additional resources
Repayment
Accrued
interest billed quarterly and may be deferred (will be added to
principal balance)
Begin to repay loan six months after you cease to be enrolled
at least half time. During this six-month "grace period",
interest will accrue on loan. Once the grace period expires, you
will begin to repay your loan. For sample repayment amounts, see Federal
Loan Repayment Chart
Complete
an exit
counseling session so you are aware of all the information you
will need to know about repaying your loan.
If
you drop to less than half time, withdraw, drop out, graduate or
simply do not return to school, this information will be reported
to the servicer and they will begin to count your grace period.
You are responsible for notifying your school immediately if your enrollment
changes as described above.
Payments
will be made to the U.S. Department of Education (holder of the
loan)
For
detailed information about repayment, deferments, forbearance, and
other frequently asked questions, go to www.dlssonline.com/
To
obtain information about consolidating your Federal Direct loans,
visit loanconsolidation.ed.gov or call 1-800-557-7392. The interest rate for a Direct Consolidation
Loan is the weighted average of the interest rates on the loans
being consolidated and is fixed for the life of the loan.
It
is important that you maintain a "very important papers file" and
keep copies of your award notices, MPN, Borrower's Rights and Responsibilities
and the Direct Loan Disclosure Statement in one place as they provide
the details of your loans, and your rights and responsibilities as
a student loan recipient.
Federal
Direct Graduate PLUS Loan
Program
Name/Contact
Federal
Direct Loan Servicing Center
(repayment information)
(800) 848-0979
www.dlssonline.com/
Federal
Direct Loan Consolidation Center
(consolidation)
(800) 557-7392.
Description/Benefits
Federally funded
Non need-based
Graduate student is the borrower
The fixed interest rate for loans in the deferment or six-month grace period is 7.9 percent for loans first disbursed July 1, 2006, and after
4 percent loan origination fee minus a 1.5 percent rebate, subtracted prior to disbursement
Awarded by your school as Federal Graduate PLUS on award notice
Awarded up to cost of attendance minus other financial aid received
This is a loan you are responsible to repay to the U.S. Department of Education
Complete the Return of Disbursed Federal Loans if you wish to cancel your loan or return funds you do not need.
If funds are returned within 120 days of the disbursement date or by your last day of enrollment for the academic year, whichever is sooner, any interest will be waived.
After you have accepted your Federal Graduate PLUS, you will
receive a "Federal Direct Loan Disclosure Statement" from
the Direct Loan Servicing Center.
The Disclosure Statement identifies anticipated disbursement dates, gross and net disbursement amounts, and loan fee amounts for all your Direct Graduate PLUS Loans for the academic year.
Eligibility
Graduate students only
Independent student
Must be enrolled at least half time
Completed Federal Direct Graduate PLUS Loan Application required by parent borrower (biological or adoptive mother or father)
Completed Federal Direct Graduate PLUS Master Promissory Note (MPN) required for first-time parent borrowers and the student
Graduate student borrower must meet credit worthiness standards (if denied credit, will be notified by Direct Loan Servicing Center.
Borrower may appeal extenuating circumstances, or obtain an endorser.
See Federal Direct Graduate PLUS Loan Information Sheet on the Federal
Direct Graduate PLUS application for details.
Award eligibility based upon EFC, cost of attendance, enrollment and other resources
Award will be canceled if enrolled less than half time
Award may be adjusted or canceled if there is a change to EFC, cost of attendance, enrollment or additional resources
Repayment
Interest begins accruing upon disbursement
Repayment of principal and interest begins 60 days after loan is fully disbursed.
For sample repayment amounts, see Federal Loan Repayment
Chart
Payments will be made to the U.S. Department of Education (holder of the loan)
Payments will automatically be deferred if you are enrolled
at least half time. For detailed information, go to www.dlssonline.com/
For detailed information about repayment and other frequently asked questions, go to www.dlssonline.com/
To obtain information about consolidating your Federal Direct loans, visit loanconsolidation.ed.gov or call 1-800-557-7392.
The interest rate for a Direct Consolidation Loan is the weighted average of the interest rates on the loans being consolidated and is fixed for the life of the loan.
It is important that you maintain a "very important papers file" and
keep copies of your award notices, MPN, Borrower's Rights and Responsibilities
and the Direct Loan Disclosure Statement in one place as they provide
the details of your loans, and your rights and responsibilities as
a student loan borrower.
Federal
Direct PLUS Loan for Undergraduate Students
Contact Information
Federal
Direct Loan Servicing Center
(repayment information)
(800) 848-0979
www.dlssonline.com/
Federal
Direct Loan Consolidation Center
(consolidation)
(800) 557-7392
Description/Benefits
Federally
funded
Non
need-based
Parent
borrows on behalf of student
The fixed interest rate for loans in the deferment or six-month grace period is as follows:
4 percent
loan origination fee minus 1.5 percent rebate, subtracted prior to disbursement
Awarded
by your school as Federal PLUS on award notice
Awarded
up to cost of attendance minus other financial aid received
This
is a loan your parent must repay to the U.S. Department of Education
Complete
the Return of Disbursed Federal Loans if you wish to cancel
your loan or return funds you do not need. If funds are returned
within 120 days of the disbursement date or by your last day of
enrollment for the academic year, whichever is sooner, any interest
will be waived.
After
you have accepted your Federal PLUS, you will receive a "Federal
Direct Loan Disclosure Statement" from the Direct Loan Servicing
Center. The Disclosure Statement identifies anticipated disbursement
dates, gross and net disbursement amounts, and loan fee amounts for
all your Direct PLUS Loans for the academic year.
Eligibility
Undergraduate
students only
Dependent
student
Must
be enrolled at least half time
Completed Federal
Direct PLUS Loan Application required by parent borrower (biological
or adoptive mother or father)
Completed Federal Direct PLUS Master Promissory
Note (MPN) required for first-time parent borrowers and the
student
Parent
borrower must meet credit worthiness standards (if denied credit,
will be notified by Direct Loan Servicing Center. Borrower may appeal
extenuating circumstances, obtain an endorser or student may apply
for an unsubsidized loan). See Federal Direct PLUS
Loan Information Sheet located on the Federal Direct PLUS Application for details.
Award
eligibility based upon EFC, cost of attendance, enrollment and other
resources
Award
will be canceled if enrolled less than half time
Award
may be adjusted or canceled if there is a change to EFC, cost of
attendance, enrollment or additional resources
Repayment
Interest
begins accruing upon disbursement
Repayment of principal and interest begins 60 days after loan is
fully disbursed. For sample repayment amounts, see Federal
Loan Repayment Chart
Payments
will be made to the U.S. Department of Education (holder of the
loan)
For
detailed information about repayment and other frequently asked
questions, go to www.dlssonline.com/
To
obtain information about consolidating your Federal Direct loans,
visit loanconsolidation.ed.gov or call 1-800-557-7392.
The interest rate for a Direct Consolidation
Loan is the weighted average of the interest rates on the loans
being consolidated and is fixed for the life of the loan.
It
is important that you maintain a "very important papers file" and
keep copies of your award notices, MPN, Borrower's Rights and Responsibilities
and the Direct Loan Disclosure Statement in one place as they provide
the details of your loans, and your rights and responsibilities as
a parent loan borrower.
Alternative
Loans
Recommended Private Alternative Loan Lenders
Choosing how to finance your education is one of the most
important decisions you will make - and the impact of that decision will
follow you well beyond graduation.
Your school will certify a private, alternative educational
loan from any lender a student chooses. The College/University does not
receive any incentives, financial or otherwise, from the lending institutions
for their placement on the Recommended Lender List.
When determining
how much to borrow, plan to borrow as little as possible. The long-term
cost is an important factor. For more information about a particular
private alternative loan, please contact the lender.
Frequently Asked Questions
I am unable to file a FAFSA. Can I still apply for a private alternative loan?
Yes. Your School urges students to complete the FAFSA,
but it is not required. Log on to www.fafsa.ed.gov for
more information.
My parents are not applying for a Federal PLUS loan. Can I apply for a private alternative loan?
Yes. You will need to cancel the Federal PLUS loan offered on your award notice.
Can my cost of attendance be increased?
If you have additional costs related to flights, child
care or study abroad, make an appointment to see a counselor prior to
applying for a private alternative loan. they can determine if your cost
of attendance can be increased.
A variety of interest rates are listed for each lender. What are they based on?
Lenders base interest rates on your credit history and your ability to repay the loan. Contact your lender for more information.
What will my monthly payment amount be?
The payment amount varies based on your interest, the amount you borrow and your total indebtedness. Contact your lender for more information.
Will my loan be sold?
Some lenders will sell your loan. Contact your lender for more information.
What happens if I cannot make my payments?
Contact your lender to determine if there are any forbearance or deferment options.
Can I consolidate my private loans with federal loans?
No. private loans cannot be consolidated with federal loans
International
Student Options
Private
lenders have Loan
Options for International Students if the student obtains a
cosigner that is a U.S. Citizen
Frequently
Asked Questions
How
much should I borrow to cover this year's expenses?
We
encourage students and parents to borrow only what they need and are
comfortable with repaying in the long run. Determine your estimated
expenses for the period of time and subtract any grants, scholarships
or other resources such as savings or earnings from work. The difference
is the amount you may need to borrow in a student and/or parent loan.
As you are borrowing funds each year, be conscious of your total loan
debt in relation to your future payment obligation and reevaluate
every time you borrow.
How
do I determine which is the best loan to borrow?
When
making the decision to borrow a particular type of loan, consider
the following questions:
What is the maximum and minimum I can borrow in this program?
Who
is responsible for paying the interest while the student is enrolled
in school?
What is the interest rate?
If the interest is the responsibility of the borrower, does the
interest need to be paid quarterly, yearly, at graduation?
How much is the interest payment?
When does the borrower need to begin repaying the principal balance
of the loan?
What is the minimum monthly payment?
How long can I repay the loan?
Can I make payments on the loan before it is due and/or pay the
amount off earlier without penalty?
What are the choices if my income changes when I'm repaying the
loan?
How
much total loan debt should I borrow?
As
you are borrowing funds each year, be conscious of your total loan
debt in relation to your future payment obligation. Take into consideration
your current need for funds, projected future earnings, and how much
you will need to live when you graduate. Then estimate your anticipated
level of debt in relation to the monthly payment obligation. Remember,
failure to make payments on time may affect your credit rating and
ability to borrow for other purposes. Reevaluate your future expenses
each time you borrow funds.
What
is meant by interest in relation to loans?
Interest
is an amount charged to the borrower for the privilege of using the
lender's money. Interest is calculated as a percentage of the principal
balance of the loan. The percentage rate may be fixed for the life
of the loan, or it may be variable, depending on the terms of the
loan.
Should
I consolidate my loans?
Consolidation
is a good way to manage your loan debt repayment. By bringing all
your federal loans together into one payment amount, you will more
easily manage your monthly loan repayment and may reduce your monthly
payments. Consolidation loans currently are based on a fixed interest
rate whereas individual loans may have a variable interest rate that
may or may not be capped at a maximum interest rate. There are some
drawbacks so students must carefully review all information from the
lender.
What
are my responsibilities as a loan borrower once I am no longer enrolled
in school?
For
Federal Direct and Federal Perkins loan borrowers, complete an exit
counseling session so you are aware of all the information you
will need to know about repaying your loan. Make your monthly payments
on time, even if you are not billed. Stay in contact with the servicer
of your loan at all times. Notify them immediately of your address,
name change, enrollment change, and/or if you are having difficulty
making payments. Open correspondence and return phone calls immediately.
What
if I am having trouble repaying my loan?
If
you have extenuating circumstances or know you will be unable to
make your monthly payment, communicate with the servicer of your loan immediately.
Avoid the costs and consequences of delinquency (late payments) and default
(no payments). Under certain conditions, you may be eligible for a forbearance, a
deferment or
cancellation.
What
is meant by capitalization of interest?
When
interest on your loans continues to accumulate and is not paid, the
accrued interest will be capitalized - added to the principal. You
will then be paying interest on the accrued interest and the disadvantage
is you pay more interest over the life of the loan. Interest may be
capitalized quarterly, yearly or at graduation.
What
can I do if I am continuing my education and re-enrolling in classes
at another school after my repayment period has
begun?
Inform
your servicer of your plans. The servicer will determine if you are
eligible for an "In-School Deferment" that allows your payments to
be delayed. Once you no longer meet the conditions of the deferment,
your repayment period begins immediately.
