Student loans can be a useful tool in funding your education, but use them wisely. You should be aware of the responsibility that borrowing money to finance your education entails.
- New Borrowers:
To apply for Federal Direct Loan Programs (Stafford Subsidized, Stafford Unsubsidized, and/or Federal PLUS), you need to initially complete the Free Application for Federal Student Aid (FAFSA). After completing and submitting the required documentation requested by the Financial Aid Office, you need to meet with a Financial Aid Expeditor to receive required entrance loan counseling. Exit loan counseling is also required when you drop below half-time status or do not enroll the following semester.
- Repeat Borrowers:
Complete the Loan Certification Form and Entrance Loan Counseling Form and submit both documents to the Financial Aid Office (S107). You will be contacted to sign off on your loan amount once your eligibility is determined.
Federal Stafford Loan Programs
Financial aid amounts are based on credit hours enrolled, course level, academic progress, funding, and program regulations. If a student drops, withdraws, fails, or does not attend courses, awards will be adjusted or canceled. The student will be responsible for any overpayments. These loans are low-interest loans to help you pay for your college education. There are two kinds of federal Stafford loans:
The subsidized loan is based on need, and the government pays the interest while the student is enrolled on at least a half-time basis. Most students will begin repayment six months after leaving Moraine Valley or dropping below half-time. The fixed interest rate for subsidized Stafford Loans is 4.66% for 2014-2015.
150% Direct Subsidized Loan Limit
Congress passed a bill that established time limitations on Direct Stafford Subsidized Loans. The new law will be effective for first time borrowers or borrowers who have paid off their loans and are borrowing again as of July 1, 2013.
This law allows you to receive Direct Stafford Subsidized Loans only within 150% of the length of your program of study. Once you have reached the end of this limit you are no longer able to receive Direct Stafford Subsidized Loans. For example, if you are enrolled in a two-year Associate of Arts degree program, the maximum period for which you can receive Direct Stafford Subsidized Loans is three years (2×150% = 3 years).Once you reach 150% of the length of your program, you may continue to receive Direct Stafford Unsubsidized Loans; however, interest will start to accrue on any an outstanding Direct Stafford Subsidized Loans you previously received.
Most students will begin repayment on the principal of the loan six months after leaving Moraine Valley or dropping below half-time. Interest begins accumulating at the time of disbursement.
Federal PLUS Loan Program
The Federal PLUS Loan is a non-need-based federal program. Parents of a dependent student may borrow up to the cost of attendance minus any financial aid to help finance their student’s undergraduate education.