Transcript Document

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Bill Mack
Associate Director of Financial Aid
University of Texas at Dallas
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Federal Insured Student Loans (FISL)
Guaranteed Student Loan (GSL)
Auxiliary Loans to Assist Students (ALAS)
Supplemental Loan for Students (SLS)
Federal Family Education Loan Program
(FFELP)
Robert T. Stafford Loan Program
William D. Ford Federal Direct Loan Program
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Entrance Counseling
First-time borrowers
Inform them of their rights and responsibilities of taking out this
loan
www.studentloans.gov
Exit Counseling
All borrowers that depart from your institution
Graduate, withdraw, transfer, do not return
www.nslds.ed.gov
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• The school is required to notify the
borrower within 14 or 30 days that a
loan disbursement has been made and
that the borrower may reduce or cancel
the disbursement
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Document executed by borrower, which
spells out the terms & conditions of
the loan disbursements, use and
repayment
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If the note is for multiple loan periods
and varying amounts, the school
may elect to have the borrower use a
Master Promissory Note
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Oldest active federal educational loan
• Institution administers this loan (Campus Based)
• Previous allocations came from the Dept of Ed,
now schools operate this loan from repaid funds
• Fixed 5% interest rate
• Repayment begins 9 months after student ceases
to be enrolled at least 1/2 time
• Minimum monthly payment is $30
• Maximum repayment term is 10 years
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Undergraduate annual limit
$5,500
Underclassman (first two years) Aggregate limit
$11,000
Undergraduate Aggregate limit
$27,500
Graduate annual limit
$8,000
Graduate Aggregate limit
$60,000
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• Federal PLUS Loan is a loan for parents of
dependent students
• Parent borrower is fully liable for loan
• FAFSA is required but is not based on need
• Eligibility
• Borrower must be the natural or adoptive parent of the student,
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or spouse of one of those people (step-parent can borrow if
he/she is included in the FAFSA)
Borrower must be a US Citizen or eligible non-citizen
Borrower must have no Title IV loans in default
Borrower must be credit worthy or have credit worthy endorser
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• No Annual limit other that COA minus Aid
• No Aggregate limit
• If the parent is not eligible the student may
borrow a Stafford Loan using the independent
student limits.
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• Eligibility
• Borrower must complete a FAFSA
• Eligible graduate student attending at least halftime
• Borrower must pass a credit evaluation or have an
eligible “endorser”.
• Annual Loan Limit
• COA minus other aid
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No aggregate maximum
7.9 percent fixed interest. 4% Origination fee.
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• Eligible student in an eligible program at an
eligible institution (per General Provisions)
• Enrolled at least 1/2 time
• COA-aid= greater than zero
• COA-EFC-aid=greater than zero for subsidized
loan
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Subsidized DL
Unsubsidized DL
(Need-based)
(Non need-based)
Interest:
Interest:
ED pays during
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Student responsible for all
In-school
• Can be capitalized, or
• Student can choose to pay
Deferment
* Student pays during
• Repayment
interest while enrolled
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Year in School
Dependent Student
Independent Student
First Year
Undergraduate
Total DL $5500*
Total DL $9500*
Second Year
Undergraduate
Total DL $6500*
Total DL $10,500*
Third Year &
Remaining
Undergraduate
Total DL $7500*
Total DL $12,500*
Graduate Student
k
Total DL $20,500*
*No
more than $3500 Subsidized may be awarded for First Year Student,
No more than $4500 Subsidized for 2nd year students, no more than $5500
Subsidized for 3rd year + undergrad students.
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As of July 1, 2012
Graduate students are no
longer be eligible for
subsidized Stafford Loans.
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Combined
Sub & Unsub
Sub may not
exceed
Undergrad
Dependent
$31,000
$23,000
*Undergrad
Independent
$57,500
$23,000
Grad and
Professional
$138,500
$65,500
* And dependent students whose parent was unable to obtain
a PLUS loan.
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• When an undergraduate student’s academic program is
less than 1 year in length and
• When a student is completing a remaining period of
enrollment that is less than one academic year
• Standard proration formula:
Amount of Stafford Loan student could have for grade level
÷ 24 x number of enrolled hours
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•
Perkins Loans – no fees
• Fixed interest = 5% (no interest while enrolled or when in nine
month grace period)
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Direct Loans – 1% origination fee
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0.5% rebate
Undergrad sub = fixed interest of 3.4%, rising to 6.8% after July
1, 2012.
• Unsubsidized = fixed interest of 6.8%
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Direct Parent PLUS / Grad PLUS – 4% origination fee
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1.5% rebate
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fixed interest = 7.9%
To retain rebates,1st 12 payments must be on time
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• As of July 1, 2012 the borrower will be charged
the full origination fee at disbursement.
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• Subsidized Stafford interest
• 7/1/98-6/30/06 2.36 or 1.76 (varies annually)
• 7/1/06-6/30/08 6.8 fixed
• 7/1/08-6/30/09 6.0 fixed
• 7/1/09-6/30/10 5.6 fixed
• 7/1/10-6/30/11 4.5 fixed
• 7/1/11-6/30/12 3.4 fixed
• 7/1/12- ?
6.8 fixed
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Federal education loans that may be consolidated
* FISL
*FFELP
*Direct Loans
*National Direct Student Loans
*PLUS
*Perkins
*Nursing Student Loan
*Health Education Assistance Loan (HEAL)
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Thirty-year repayment (maximum)
 Interest rate will be a fixed interest rate, capped at
8.25%
 A weighted average is used to figure the interest rate
and then it is rounded up to the nearest 1/8 of a
percent.
* A consolidation loan can “cure” a defaulted federal student
loan.
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• Interest rates are usually variable
• Origination and repayment fees vary
• Co-borrower requirements (underwriting)
• Most require school-certification
• Cannot be discharged in bankruptcy
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• International students
• SAP ineligible
• Non-degree students
• Reached federal annual or aggregate maximum
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* Borrowing is bad
* Borrowing a federal loans is bad but not as bad
as some other loans
* If a student can afford to attend college
without loans he should do that
* If a student must borrow to attend college she
should borrow as little as possible.
* We cannot control how much a student borrows
* We are responsible when a student defaults on
their federal loan
Bill Mack
[email protected]
972-883-4795
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