Federal Direct Loans
Federal direct loans are guaranteed, long term, low interest loans awarded to students by the school and funded directly through the federal govenment.
Direct Subsidized Loans
To be eligible for a subsidized loan, your family must show financial need using the FAFSA. The loan limit for a freshman is $3,500. Loans are subject to an origination fee of 1%. For 2013-14, the interest rate is 3.86%. No repayment of principal or interest is due until after leaving school or falling below half-time status. (Additional funds may be available on an unsubsidized basis.)
Direct Unsubsidized Loans
This loan is not subject to need. Total combined unsubsidized and subsidized Stafford Loan is $5,500 for first-year students. Loans are subject to an origination fee of 1%. The terms and conditions for the unsubsidized loan are the same as for the subsidized loan, except that interest (3.86%) on the loan is due while the student is in school. Interest may be paid during school or added to the loan as agreed by the borrower and the lender. This option increases the total cost of borrowing.
Direct Parent Loans For Undergraduate Students (PLUS)
Your parents may borrow up to the cost of education, minus any other aid received, for each academic year for each dependent undergraduate. Loans are subject to origination and insurance fees totaling 4.2%. The interest rate is currently fixed at 6.41%. Interest begins to accrue after payment to your account. Your parents can choose to begin repaying the loan 60 days after disbursement in the aid year or defer payment up to six months after you graduate or fall below half-time status. Interest may be paid during this time or added to the loan. Your parents must complete the PLUS Request Process and pass a federal credit review.
Federal Perkins Loan Program
To be eligible for this loan, you must demonstrate financial need as determined by the FAFSA. Freshmen may be offered up to $5,500 per year. While you attend school at least half time, no interest is charged and repayment is deferred. Repayment with interest begins nine months after leaving school. The interest rate is 5%.
Non-government, private market loans are also available. Alternative educational loans may be an option for students who need an additional resource to help pay for college expenses. Generally, these loans are borrowed by the student, using a creditworthy co-signer. Variable interest rates apply and can sometimes become quite costly. These are usually more expensive than the PLUS loan and should only be pursued after all other forms of federal aid have been exhausted. Contact campus financial aid offices and lenders for information.